Shepherdstown register. [volume] (Shepherdstown, Va. [W. Va.]) 1849-1955, 1895-09-19
SUPPLY AND DEMAND.

!
mand" is in every ones mouth, there
are comparatively few people who have
an adequate or accurate conception o
the wide range and the exact mode ,
its operation. 1t is common knowledge
that the relation between supply and
demand governs prices; but, on the
other hand, it is not generally borne
in mind that it is the matter of price
alone that brings these two elements
into direct relation with each other.
The first effect of an increasing or de-
creasing demand is no doubt to raise
or lower price but this change in price
produces or tends to produce greater
or less supply to correspond with the
demand, which in turn tends to restore
prices to the original plane.
Normally it is the demand that in
fuences both price and supply; that
is to say, demand is usually the active
element in the operation of the law,
though in some cases the creation of a
new supply will induce demand for
the commodity supplied. 1t is proba-
bic that the idea conveyed by the term
demand" in this sense is simply de-
sire; but the true meaning Of the term
is far more limited than this. The de-
sire for almost any commodity is uni
versal and therefore such a demand
would be practically unlimited. Eff
fectual demand, such alone as can have
any influence on production and prices,
means desire coupled with the ability
to obtain, by giving something in ex-
change for the thing desired. The de-
Nire of millions for a commodity that
costs dollar to produce it is Of no eff
feet if they cannot afford to pay the
dollar.
The normal price of any commodity
is the cost of producing it; for there
is no motive for producing it if the
producer cannot get for it as much as
it has cost him. To put it another
way, he has expended a certain amount
of labor in its production; he will
therefore only part with it for some
thing that would cost him an equal
amount of labor to produce for him
self. This, then, fixes the minimum
value of the commodity.
Now there will be certain amount
of people who can afford to give this
value for his commodity; there will be
a number of others whose condition is
such that they cannot afford to give
so much for it; and however numer-
Gus they may be or however dire their
need, their desire has no effect upon
the price. Ifhe has produced the COM
modify in sufficient quantity to supply
all those who are able to give him its
prime cost, he can get no more than
that for it. If he has produced less
quantity, there will not be enough to
90 around. The question then arises
among the purchasers, who is to get it
and who must do without? Some of
them will be in a position to be able
to give little more than the prime
cost, and they Will offer an advance.
The advanced in price will "freeze out
a certain number, and the effective de-
mand will be that much lessened. If
there is still not enough for all, those
who can afford it will offer a further
advance, and several more will be out
of the market. And it will go in this
way until there are only enough left
to absorb the whole product and be
satisfied, when the bidding will cease.
As matter of fact the price Will not
90 quite to this point. For every adj
vance offered over and above the nor
NAL cost means a clear profit on the
production of the commodity, and 9TH
ers will be attracted to producing it
and the supply will be increased until
there is enough to satisfy all who can
give some intermediate advance. The
price will cease to advance as soon as
it becomes apparent that those who are
able to give that price will absorb the
entire supply and no more. The claw
of supply and demand concisely
stated, therefore, is this The price Of
any commodity will be such that the
demand at that price is exactly equaI
to the supply at that price.
Roasted in Mid-Air.
w w Fitzoerald q house painter