The term 'Price Factor' refers to the two main components that determine the price of a good or service: SUPPLY and DEMAND. SUPPLY is the amount of a good or service that is available, while DEMAND is the amount of a good or service that is desired by consumers. When the SUPPLY of a good or service is low, prices tend to be higher due to the increased DEMAND. Conversely, when the SUPPLY of a good or service is high, prices tend to be lower due to the decreased DEMAND.