The selling price of goods and services is based on seller supply and consumer demand. If prices are too high, consumers may not be able to purchase goods and services they require. If demand drops, seller profits fall. If prices are too low, sellers might not be able to cover production costs. When prices are low, consumers generally can satisfy their needs (food, housing, medical care, for example).

On completion of this unit, you will be able to
  • define the relationships among supply, demand, and price;
  • identify and compare how various economic conditions affect supply, demand, and price;
  • interpret graphs of supply, demand, and price; and,
  • describe shifting markets.