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If supply is greater then the demand then the price is lower but if the demand is higher then the supply then the price is higher due to rarity. :)

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Leann Raynor

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2y ago
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Wiki User

13y ago

Price does not often affect demand and supply. This is a cause and affect relationship. The affected is usually the price. Demand and supply are the cause. As demand for a certain item goes up, the price will follow, because more people will be willing to pay more money to own one. However, if demand is low and supply is high, the price will likely drop as the supplier will want to move stock. Price can sometimes lower demand though. If the price ventures too high, and enough people see that they are paying too much for a product, the demand will drop, likewise if the price is too low and the consumer sees that they are getting a good deal, the demand will go up.

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Q: How does supply and demand affect pricing?
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