Demand is closely related to the concept of supply. While consumers try to pay the lowest prices they can for goods and services, suppliers try to maximize profits. Demand drops if suppliers ...

A supply curve reveals if a commodity will experience a price increase or decrease based on demand. The supply curve is shallower, closer to horizontal, for products with more elasticity.

The international substitution effect provides an explanation for the downward slope of the aggregate demand curve. The textbook explanation relies on fixed exchange rates. With flexible rates, the ...