Title: (Optional) Explain the law of supply and demand.
Course: Entrepreneurship Infusion Unit > Section: Understanding Basic Economic Principles

Explanation should define the concept of supply and demand and exemplify the ways supply and demand interact to determine equilibrium price:

- When supply is up and demand is down, prices decrease.
- When supply is down and demand is up, price increases.

Explanation should also include ways that supply and demand are affected by various factors, such as

- resources
- natural and economic events
- government intervention
- technology.

Process/Skill Questions:

- What is the difference between supply and demand?
- What current trends in industry will affect the present supply and demand in our economy?
- How are prices affected by supply and demand?
- How can supply and demand affect a small business?
- When is equilibrium achieved between supply and demand?
- Why must entrepreneurs have a practical understanding of the concept of supply and demand?
- What is an example of a surplus? How does a surplus affect prices?
- Why is it important for consumers to understand supply and demand?
- How might a shortage of a good or service be beneficial to the economy?
- What is the effect of substitutes on supply and demand?