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- Will price increase as demand increase? 4 answers
The law of demand holds that ceteris paribis, a decrease of demand can be caused by an increase in price. However, it is also true that when demand decreases, the price will decrease, it will fall. How can one explain this seeming contradiction? I know it's because of the invisible hand of the market forces, but can I don't know how to specifically explain what is that makes this make sense, and ensures that it is not contradiction with the law of demand. Can someone please explain?