Demand refers to the quantity of a product or service that consumers are willing and able to purchase at various prices. Generally, as the price of an item decreases, demand increases, and vice versa. This relationship is known as the law of demand, which illustrates how consumer preferences and purchasing power influence market behavior. Supply is the amount of a product or service that producers are willing and able to sell at different prices. Typically, as the price rises, supply increases, reflecting the law of supply. The interaction between demand and supply determines the market equilibrium, where the quantity demanded equals the quantity supplied, establishing the market price.