The Key Difference Between Law of Demand and Law of Supply

Law of Demand vs Law of Supply
Feature	Law of Demand	Law of Supply
Definition	States that, all else being equal, as the price of a good falls, the quantity demanded increases, and vice versa.	States that, all else being equal, as the price of a good rises, the quantity supplied increases, and vice versa.
Price Relationship	Inverse relationship between price and quantity demanded.	Direct relationship between price and quantity supplied.
Graph Slope	Downward sloping demand curve from left to right.	Upward sloping supply curve from left to right.
Consumer/Producer Side	Reflects consumer behavior.	Reflects producer behavior.
Motivation	Consumers aim to maximize utility or satisfaction.	Producers aim to maximize profit.
Effect of Price Increase	Quantity demanded decreases.	Quantity supplied increases.
Effect of Price Decrease	Quantity demanded increases.	Quantity supplied decreases.
Assumptions	No change in income, tastes, or other factors affecting demand.	No change in input costs, technology, or other factors affecting supply.
Focus	Analyzes how consumers respond to price changes.	Analyzes how producers respond to price changes.
Application	Used to forecast consumer behavior in pricing decisions.	Used to forecast production levels based on price signals.
Example	If the price of coffee drops, more people buy coffee.	If the price of smartphones rises, more companies start making smartphones.
Elasticity	Measures responsiveness of quantity demanded to price changes.	Measures responsiveness of quantity supplied to price changes.
Market Role	Determines how much of a good consumers are willing to buy.	Determines how much of a good producers are willing to sell.
Behavioral Basis	Based on diminishing marginal utility.	Based on increasing marginal cost of production.
Policy Relevance	Helps in understanding subsidy and price control effects on consumers.	Helps in analyzing effects of taxes and incentives on producers.