Final answer:
Price is the amount of money buyers pay for a unit of a specific good or service. It is determined by the law of demand and plays a crucial role in determining the quantity demanded. In financial markets, price refers to the rate of return or interest rate received by investors.
Step-by-step explanation:
Price is best defined as the amount of money that buyers pay for a unit of a specific good or service. It is also the sum of the values that customers exchange for the benefits of having or using the product or service. In economics, price plays a crucial role in determining the quantity demanded of a product or service.
For example, when the price of a good or service increases, the quantity demanded usually decreases, while a decrease in price tends to increase the quantity demanded. This is known as the law of demand. The law of demand assumes that all other factors affecting demand remain constant.
In financial markets, the concept of price is slightly different. Here, price refers to the rate of return or interest rate received by investors. The quantity is measured by the money that flows from those who supply financial capital to those who demand it.