[ 433 ] Economics GED ® TEST SOCIAL STUDIES FLASH REVIEW _____________ • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Use the information to answer the following two questions. The law of supply and demand is a basic economic principle. Demand refers to how much of a product or service is desired by consumers at a certain price. Supply refers to the quantity producers are willing to provide at a certain price. The point at which the supply and demand curves meet dictates the price. This is sometimes called the equilibrium. What can you conclude from this information? a. Supply stays the same regardless of the price. b. When the price is higher, supply will be lower. c. Demand stays the same regardless of the price. d. When the price is higher, demand will be lower.