In a competitive market, how do firms typically respond to an increase in demand for their product, assuming supply remains constant?

When there is an increase in demand for a product in a competitive market, firms usually respond by increasing their prices. This happens because more people want to buy the product, but the supply hasn't changed, so there are not enough products for everyone who wants them. For example, if a popular toy suddenly becomes very trendy and many kids want it, the store might raise its prices because they can sell the limited stock at a higher price. As prices rise, some consumers may decide not to buy the product, which helps balance the demand with the available supply. Over time, if the demand remains high, firms may also start producing more of the product to meet this new demand.