Which concept relates to the idea that the price of a good changes depending on supply and demand conditions?

The idea that the price of a good changes depending on supply and demand conditions is best captured by the concept of supply and demand. This fundamental economic principle explains how the availability of a product (supply) and the desire for that product (demand) interact to determine the market price. When demand for a product increases while supply remains constant, prices typically rise as consumers compete to purchase the limited goods available. Conversely, if supply exceeds demand, prices tend to fall.

Market equilibrium refers specifically to the point where the quantity supplied equals the quantity demanded, but it does not encapsulate the broader dynamic of how prices fluctuate in response to changes in supply and demand over time. Cost-benefit analysis is a decision-making tool used to compare the costs and benefits of a particular choice rather than a principle relating to price changes. Elasticity measures how sensitive consumers are to price changes, but it is a more specific concept focusing on the responsiveness of quantity demanded or supplied to price changes, rather than the general principle of how supply and demand affect pricing.