A-Level Economics Supply and Demand Revision Notes
Master A-Level Economics Supply and Demand using simple revision notes, key facts and practice questions — all generated by AI for your exam.
Supply and demand are fundamental concepts in economics that describe how the quantity of a good or service available in the market interacts with consumer desire for that good or service. The relationship between supply, demand, and price determines market equilibrium and influences economic decisions.
Key Concepts
- 1Law of Demand
- 2Law of Supply
- 3Market Equilibrium
- 4Shifts in Demand and Supply
- 5Price Elasticity of Demand and Supply
Simple Explanation
Supply is how much of a product is available for sale, while demand is how much of that product consumers want to buy. When demand increases, prices usually go up, and when supply increases, prices tend to go down. The point where supply and demand meet is called market equilibrium, which helps determine the price of goods.
Memory Trick
“Remember 'DIPS' for Supply and Demand: Demand Increases, Price Soars; Supply Increases, Price Sinks.”
Flashcards
What is the Law of Demand?
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Exam Questions
Describe and explain the factors that can cause a shift in the demand curve. [6 marks]
6 marksView mark scheme hint▾
Discuss factors like income, preferences, prices of substitutes and complements, and expectations. Include diagrams if necessary.
Explain how an increase in supply affects market equilibrium. [4 marks]
4 marksView mark scheme hint▾
Discuss the impact on equilibrium price and quantity, and include a diagram to illustrate the shift.
What is meant by 'market equilibrium'? [2 marks]
2 marksView mark scheme hint▾
Define market equilibrium and explain its significance in the context of supply and demand.
Practice Quiz
What happens to demand when consumer income increases?
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