Final answer:
The debate between whether supply creates its demand or demand creates its supply reflects two schools of economic thought: Say's Law indicates that production of goods naturally generates the equivalent demand, while Keynesian Economics holds that consumer demand drives production and supply.
Step-by-step explanation:
The question at hand addresses whether supply creates its own demand or demand creates its own supply. This is the classic economic debate between Say's Law and Keynesian Economics.
Say's Law posits that the production of goods and services will create a demand equivalent to its supply. This school of thought believes in the long run, an economy's ability to supply goods will naturally generate the necessary demand, thus justifying the investment made by producers.
On the other hand, Keynesian Economics suggests that it is demand which necessitates the creation of supply. According to this theory, consumers' desire to purchase goods is what drives producers to create and supply products. In times of economic downturns, where demand is low, this law argues for external intervention, such as government spending, to increase demand and thereby stimulate supply.