Well, say a company has a whole bunch of a certain type of product. They have plenty of "supply." But if they don't have that many customers to buy that product, then they don't have a lot of "demand." Therefore, in order for them to sell the product, they need to make it cheaper to get rid of it. And it works opposite too. If they have little of the "supply," and lots of "demand," they will increase the price, so they can make a better profit.
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