Bite Size Economics no.18 'All economics starts with the relationship between supply & demand'. Economics is built on a simple argument: the price mechanism reflects supply & demand. While often radically *modified*, the crucial grounding of economics is that in an environment of scarcity (see BSE 15) when demand rises, prices rise unless supply also rises, and conversely if supply *does* rise that has a downward pressure on prices. From this, all else follows. #BIteSizeEconomics #economics