Supply and demand scenarios refer to the balance between the availability of a product or service and how much consumers are willing to pay for it. When there is little supply relative to demand, prices tend to increase as companies look to make more profit from what’s available. Conversely, when there is an abundance of a product or service, market forces will drive prices down as competition increases among suppliers. Supply and demand scenarios are critical considerations in business planning and should be continually monitored to ensure the most financially viable decisions are made.