ABSTRACT
Supply and demand are closely related ideas. Large purchasing power brings forth large demands, and in response to demands supplies are produced. An exception to this must be made for fixed supplies. The cost or price outgo necessary to get twenty bushels of potatoes may be divided into several parts. The amount of costs which the business man is willing to undergo is determined by the price which he expects the product to bring. Productive factors are priced in keeping with the price of their anticipated yields. A security will bring a high price if it promises to pay a high return. Land, mines, steamships, and other productive agents are high-priced or low as their anticipated incomes are large or small. Consumption goods and present supplies are not as a rule the products of current industry. A large demand by the harness-makers means a smaller supply of leather for shoes.
