Demand and supply of Business economics

        The two main economic forces of the free market that control the production and sales by suppliers and consumers are known as supply and demand. Demand means what products, items, services or commodity required and wants to purchase by the consumer at some specific price rate. Supply means how much the services, commodity, product or items provide to market at specific price rate. In simple words, supply explain that how much producer are going to produce or provide services in the market by utilizing their limited resources and demand show the desire of buyer to utilize the product or services in the market. (Agarwal, n.d.)

         In setting the price of the product, supply and demand also play important role. Due to scarcity of resources, the all demands of the buyer never fulfill. In allocating the resources efficiently, the role of demand and supply is very important and also et a price which is consider as price equilibrium. At this price the buyer are willing to buy the product or service and producer are willing to produce the product or service.

        This equilibrium point show that at this point the demand and supply going to be equal by utilizing their resources at their best position. The balance must be important to maintain between demand and supply because is the demand going to decrease the extra products going to waste and the supplier didn’t receive its right return and if the demand going to increase then the supplier face a shortage of product and market also face these issues.