RELATION BETWEEN DEMAND AND SUPPLY

Demand and  Supply  are the most integral part or we can say the backbone of the economic or the market.
    * Supplier is the what the producer are willing and able to sell in the market at some given price at the given period of time,where demand is what consumers are willing and able to purchase in the market at the given period of time.
    * And we are standing in a economy where major decisions are taken by the forces of demand and Supply. Both are the two aspects which we all have to judge in order to take major decisions for the warefare of economy as a whole.
        
So the relation of supply and demand is quite easy to understand, whatever changes in one thing, it would affect other aspects as well.That means we cannot think of single aspect without thinking it's affects on other aspect.There are mainly two types of law introduced for working of the economy.
      1.Law of Demand:-It states the inverse               relationship between price of goods and the demand.
   Ex:If price of toothpaste increases from Rs.30 to Rs. 50, the demand for the same will fall.As a result people will avoid buying the same product and will go for the alternative option.
       2.Law of Supply:It states the direct relationship between price of the goods and services of the demand.
     Ex:If the price of the book will increase from RS.200 to RS. 300 then the  supply for the same will also increase after increase of RS 100.As a result the producer will produce more.
      CASE 1:-SUPPLY>DEMAND
             When the price of the goods and services are set above the equilibrium price which creates advertising in supply by the producers but demand in the existing product is not that efficient.
    CASE 2:-SUPPLY<DEMAND
             Where the price of goods and services are set below the equilibrium price which creates advertising in demand by the consumers but the supply of the product is not that efficient.
    CASE 3:-SUPPLY=DEMAND
            Where the price of the goods and services by consumers is equal.
      In short run, supply is limited as production cannot be increased immediately. But in long run if the demand is still continuous, production increases by expansion of the size of industrial unit.
       SUPPLY sometimes creates DEMAND and DEMAND sometimes creates SUPPLY.