Changes

No company can afford to build cars (supply them) if the sales price is only $1.  But at a sales price of $30,000, a vast number of cars can be built.  '''The cause is price, and the effect is quantity''': the higher the market price for something, the more that manufacturers will want to make and sell it.

No company can afford to build cars (supply them) if the sales price is only $1.  But at a sales price of $30,000, a vast number of cars can be built.  '''The cause is price, and the effect is quantity''': the higher the market price for something, the more that manufacturers will want to make and sell it.

[[File:Red Lamborghini.png|200px|thumb|right|Impress the girls with this Lamborghini sports car, at a cost of $350,000.  Not much demand at that high price!]]

[[File:Red Lamborghini.png|200px|thumb|right|Impress the girls with this Lamborghini sports car, at a cost of $350,000.  Not much demand at that high price!]]

The demand for a good is also described in terms of price and quantity.  At a given price, there is a specific quantity demanded by the public for the good.  A billion people might buy a car if the price were only $1 (unrealistic).  At a much higher price of $30,000, the demand drops to a quantity of only millions sold (realistic).  At a still higher price of more than $100,000, the demand falls much further to the range of only a few thousand that can be sold (these are the very luxurious cars, like the Lamborghini sports car shown at the right).

The demand for a good is also described in terms of price and quantity.  At a given price, there is a specific quantity demanded by the public for the good.  A billion people might buy a car if the price were only $1 (unrealistic).  At a much higher price of $30,000, the demand drops to a quantity of millions sold (realistic).  At a still higher price of more than $100,000, the demand falls much further to the range of only a few thousand that can be sold (these are the very luxurious cars, like the Lamborghini sports car shown at the right).

Because supply and demand can both be expressed in terms of price and quantity, they can be plotted on the same graph.  '''''Price (P) is on the y-axis, and quantity (Q) is on the x-axis'''''.  This is in alphabetical order:  "p" for price is lower in the alphabet than "q" for quantity, and "p" appears first on the graph as one reads from left to right.  Put another way, the graph is of "Ps and Qs," in that order from left to right (P on the y-axis to the left, and Q on the x-axis to the right).

Because supply and demand can both be expressed in terms of price and quantity, they can be plotted on the same graph.  '''''Price (P) is on the y-axis, and quantity (Q) is on the x-axis'''''.  This is in alphabetical order:  "p" for price is lower in the alphabet than "q" for quantity, and "p" appears first on the graph as one reads from left to right.  Put another way, the graph is of "Ps and Qs," in that order from left to right (P on the y-axis to the left, and Q on the x-axis to the right).