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What Are the Two Effects That Explain the Law of Demand

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Essay

What are the two effects that explain the Law of Demand? Briefly explain each effect.


Definitions:

Expected Shortage

Expected shortage refers to the anticipated shortfall in inventory due to higher demand than the supply available.

Inventory Stock

The quantity of goods or materials a business holds for the purpose of resale or production.

Product Availability

The state of a product being in stock and accessible for purchase by consumers.

Customer Order

A request made by a customer to purchase goods or services from a business.

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