The ________ describes the relationship between prices and demand. According to this law, higher prices encourage buyers to look for a substitute. A substitute is a roughly equivalent good or service. Finding substitutes drops demand for the original good or service, thus lowering prices over time. The ________ tells the relationship between price and quantity supplied A rise in prices

Question

encourages producers to supply more of a good or service in the hopes of making more money.

# law of supply

#law of demand

:: relative price

#substitute

#demand curve

Answer 1

The law of demand describes the relationship between prices and demand. According to this law, higher prices encourage buyers to look for a substitute. A substitute is a roughly equivalent good or service. Finding substitutes drops demand for the original good or service, thus lowering prices over time. The law of supply tells the relationship between price and quantity supplied. A rise in prices encourages producers to supply more of a good or service in the hopes of making more money.