supply and demand

1. In classical economic theory, the relation between these two factors determines the price of a commodity. This relationship is thought to be the driving force in a free market. As demand for an item increases, prices rise. When manufacturers respond to the price increase by producing a larger supply of that item, this increases competition and drives the price down. Modern economic theory proposes that many other factors affect price, including government regulations, monopolies, and modern techniques of marketing and advertising.

Example Sentences

Carter said the NFL franchise valuations published by Sportico and others aren’t entirely accurate because they don’t fully reflect the supply and demand for teams at any given time.

From Los Angeles Times

He argues that the proposed new public health ministry regulations will restrict supply and demand, and restore the industry to what it was always intended to be, focused solely on the medical use of marijuana.

From BBC

“By January, maybe they’ll get supply and demand in balance.”

From Los Angeles Times

It's a simple issue of supply and demand, agricultural economist Kunio Nishikawa of Ibaraki University says.

From BBC

There might be some truth to that: As David Ortega, a food economist at Michigan State University, told me, egg producers generally set their prices based on the research conducted by various analytics firms that evaluate the supply and demand in the market.

From Slate