1. Demand: Demand refers to the quantity of a good or service that consumers are willing and able to purchase at a given price and within a specific time period. It is influenced by factors such as the price of the product, consumer preferences, income levels, and the availability of substitutes. When the price of a product decreases, the quantity demanded usually increases, and vice versa, creating a downward-sloping demand curve.

2. Supply: Supply refers to the quantity of a good or service that producers are willing and able to offer for sale at a given price and within a specific time period. It is influenced by factors such as the cost of production, technology, availability of resources, and government regulations. When the price of a product increases, the quantity supplied usually increases as well, and vice versa, creating an upward-sloping supply curve.

3. Surplus: Surplus occurs when the quantity supplied of a good or service exceeds the quantity demanded at a given price. This means that there is more supply available than there is demand for the product. In order to sell the excess supply, sellers may lower the price to attract more buyers and reach a new equilibrium. The decrease in price helps to eliminate the surplus and bring the market back into balance.

4. Shortage: Shortage occurs when the quantity demanded of a good or service exceeds the quantity supplied at a given price. This means that there is more demand for the product than there is supply available. In response to the shortage, sellers may increase the price to take advantage of the high demand and maximize their profits. The increase in price helps to reduce the demand and bring the market back into equilibrium.

5. Equilibrium price: Equilibrium price is the price at which the quantity demanded of a good or service equals the quantity supplied, resulting in a market balance. It is the point where the demand curve and supply curve intersect. At equilibrium, there is neither a surplus nor a shortage in the market. The equilibrium price is determined by the forces of supply and demand and can fluctuate based on changes in market conditions.

Understanding these concepts is important in analyzing market dynamics and predicting the effects of changes in supply and demand on prices and quantities in the market. 

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