Which contains the connection between the law of demand and excess demand?

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Social Studies

Alanna Melendez

14 August, 12:41

Which contains the connection between the law of demand and excess demand?

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Shania Harper · Answer 1

The law of demand refers to an economic concept that says that the quantity of a good demanded is inversely related to its price.

The excess of demand means that an economic situation where the market demand of a product is greater than it supplies, so that is why the price is higher.

The connection between the law of demand and excess demand is that the law says that the price of a product decreases to later demand and limited supply, which occur on the excess of demand.

The interaction of supply and demand make customers and vendors react in different ways when there is a change in the price of a product or a service. When price increases, sellers want to sell more but buyers want to buy less. When prices reduce, is the client who wants to buy more.