Difference Between Demand and Supply

Main difference

The main difference between demand and supply is that demand refers to the number of buyers and supply (quantity of a product or service) represents how much the market can offer.

Demand vs. Offer

The balance between the price and quantity demanded of a product or commodity in a given period is called demand. On the contrary, the balance between the price of the product or goods and the quantity supplied in a given period is called supply. While the ability to pay and the buyer’s devotion to a specific price is demand, while the amount that the producers of those products say to their clients or consumers at a certain price, the demand offered has an inverse or indirect relationship with the price. price which is that if the price of the goods increases, the demand decreases. Similarly, if the price of the product decreases, the demand increases, however, on the other hand, the price has a direct association with the supply, that is, if the price decreases, the supply will also decrease and if the price increases, the supply will also increase. The demand represents the consumer or the preferences and taste of the client for a product or the good that they demand, on the other hand, the offer represents the companies, which is the quantity of the good or the good that those producers offer in that enormous market .

Comparison chart

Demand Supply
Demand is a buyer’s desire and ability to pay for a particular product at a specific price. Supply is the abundance of a product that producers make available to their consumers at a given price.
When demand increases, supply decreases, that is, an inverse relationship. When supply increases, demand decreases, that is, an inverse relationship.
price impact
With a rise in price, demand decreases and vice versa, that is, an indirect relationship. Supply increases along with the price increase. So it has a direct relationship.
negative slope Upward sloping
Effect of Variations
Demand increases and supply stays the same leading to a shortage, while demand decreases and supply stays the same leading to a surplus. Supply increases and demand stays the same leading to a surplus, while supply decreases and demand stays the same leading to a shortage.
Who represents what?
The demand represents the consumer. The offer represents the company.

What is the demand?

Demand is a business or economic principle that refers to a consumer’s desire and willingness to pay the price for a defined product or service. Holding all other things constant, an increase in the price of a good or service will decrease demand and vice versa. Think of demand as your willingness to go out and buy a defined product. For example, market demand is the sum of what everyone in the market wants. Businesses often spend a substantial amount of money to determine how much demand the public has for their goods and services. Furthermore, incorrect estimates result in money left on the table if demand is not met or losses if demand is overestimated. There are five determinants of demand. The most important is the price of the good or service itself. The second is the price of related products, whether substitutes or complements. Circumstances drive the next three determinants. These are the consumers’ income, their tastes and their expectations.

Classification Basis

  • Individual demand and market demand
  • Total market demand and market segment demand
  • Derivative demand and direct demand
  • Industry demand and company demand
  • Short-term demand and long-term demand
  • price demand
  • Income demand
  • cross demand

What is the offer?

Supply is an essential economic impression that describes the total quantity of a specific product or service that is available to consumers. The offer can be linked to the quantity available at a specific price or the quantity available covers a range of prices displayed on a chart. This is closely related to the demand for a product or service at a particular price; Other things being equal, the offer submitted by producers will increase if the price rises because all firms seek to maximize profits. The concept of supply in economics is complicated with many mathematical formulas, practical applications, and contributing factors. While supply can relate to anything in demand that is sold in a competitive market, supply is used more to relate to goods, services or work. One of the most important factors influencing supply is the price of the good. In general,


  • market offer
  • short term offer
  • long term supply
  • joint supply
  • Composite Supply

Key differences

  1. The stability between the quantity demanded and the price of a product at a given time is known as demand. On the other hand, the stability between the quantity supplied and the price of a good at a given time is known as supply.
  2. Demand is the availability and profitability of a buyer at a specified price, while supply is the quantity supplied by producers to their customers at a specified price.
  3. The demand has an oblique relationship with the price, that is, if the price increases the demand decreases, as well as if the price decreases the demand increases, despite that, the price has a direct or direct relationship with the supply, that is , if the cost or price increases. the offer will also increase, in addition, if the price decreases the supply also decreases.
  4. While the demand curve is downward sloping, the supply curve is upward sloping.
  5. The demand illustrates the inclination and preferences of the customer for a particular product demanded by him, although the offer represents the companies.

Final Thought

The market has been flooded with various substitutes in each product category, and a rapid rise or fall in prices will influence these goods, and their supply and demand may rise or fall. Demand and supply refer to the relationship that the price has with the quantity demanded by consumers and the quantity supplied by producers. As for price increases, the quantity demanded decreases and the quantity supplied increases.

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