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♪ [music] ♪ - [Narrator] Supply and demand are fundamental concepts in economics. Usually, theyre represented by a graph like this. So what does this mean? Well, lets start with the demand curve. In short, a demand curve shows how much of a good people will want at different prices. What happens when theres a big sale? Well, at a lower price, people buy more. More shirts, more pants, more video games, and they do stuff like this. This is what happens on Black Friday when retailers lower their prices to get people to buy stuff for Christmas. The demand curve illustrates the intuition for why people go nuts on Black Friday. Price is shown on the vertical axis, and quantity is shown on the horizontal. Heres the normal price, and heres the Black Friday reduced price. Simply put, the quantity demanded increases as the price gets lower. But lets delve a little deeper. Theres a different demand curve for every good or service out there, but the ideas are the same. So, lets look at the
