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Category - Economics

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The law of supply and demand dictates that if the supply is low and the demand is high:

The price will start moderate and increase gradually until it's high.
The price will start high and decrease gradually until it's moderate.
The price will be high.
The price will be low.

Explanation

Answer: C - If there is limited supply of an item that is in demand, its price will be high relative to the value of the item. The law of supply and demand describes the relationship between the availability of a product and the buying public's desire to purchase the product.

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