How do changing prices affect supply and demand? As price increases, both supply and demand increase.
As price decreases, both supply and demand decrease.
As price increases, supply decreases, but demand increases.
As price decreases, supply decreases, but demand increases.

The theory defines the relationship between the price of a given good or product and the willingness of people to either buy or sell it. Generally, as price increases, people are willing to supply more and demand less and vice versa when the price falls.

Explanation:

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