<human>:  What is the law of supply and demand?
<bot>: The law of supply and demand states that the price of a good or service is determined by the balance of its supply and the demand for it in the marketplace. The law of supply and demand plays a fundamental role in determining the price and quantity of goods traded in a market. It states that, when demand is high and supply is low, the price rises; when demand is low and supply is high, the price falls.