Demand in economics

Equilibrium Price
Also called a market-clearing price, the equilibrium price is the price at which the producer can sell all the units he wants to produce, and the buyer can buy all the units he wants.
With an upward-sloping supply curve and a downward-sloping demand curve, it is easy to visualize that the two will intersect at some point. At this point, the market price is sufficient to induce suppliers to bring to market the same quantity of goods that consumers will be willing to pay for at that price. Supply and demand are balanced or in equilibrium. The exact price and amount where this occurs depend on the shape and position of the respective supply and demand curves, each of which can be influenced by several factors.
Factors Affecting Supply

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  Supply is largely a function of production costs, including:
  
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  Labor and materials (which reflect their opportunity costs of alternative uses to supply consumers with other goods)
  
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  The physical technology available to combine inputs
  
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  The number of sellers and their total productive capacity over the given time frame
  
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  Taxes, regulations, or additional institutional costs of production
  

Factors Affecting Demand
Consumer preferences among different goods are the most important determinant of demand. The existence and prices of other consumer goods that are substitutes or complementary products can modify demand. Changes in conditions that influence consumer preferences can also be significant, such as seasonal changes or the effects of advertising. Changes in incomes can also be important in either increasing or decreasing the quantity demanded at any given price.
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What Is a Simple Explanation of the Law of Supply and Demand?
In essence, the Law of Supply and Demand describes a phenomenon familiar to all of us from our daily lives. It describes how, all else being equal, the price of a good tends to increase when the supply of that good decreases (making it rarer) or when the demand for that good increases (making the good more sought after). Conversely, it describes how goods will decline in price when they become more widely available (less rare) or less popular among consumers. This fundamental concept plays a vital role throughout modern economics.