We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Aggregate supply and demand - Term Paper Example

Comments (0)
The resources that the world is endowed with are limited. As a result the net profit increases.Resource Allocation is the method in which the limited resources of an economy are distributed among the alternative uses that satisfy the wants of the users. …
Download full paper
Aggregate supply and demand
Read TextPreview

Extract of sample
Aggregate supply and demand

Download file to see previous pages... The resources that the world is endowed with are limited As a result the net profit increases. Answer 1: Resource Allocation Resource Allocation is the method in which the limited resources of an economy are distributed among the alternative uses that satisfy the wants of the users. The process of decision making by which it is determined which want is to be fulfilled and which is not is part of the allocation process. Scarcity This concept in economics means that the human needs cannot be completely satisfied because an economy does not have the sufficient resources that can contribute to production. The scarce resources include the factors of production, i.e. land, labor, capital and organization. For example, the amount of land that can be used for productive purposes is limited. This means that land is a scarce resource and the supply is limited (Schiller, 2010). Competitive Advantage A country X has a competitive advantage over another country Y if the country X has abundant resources that are required to produce a good in the country and thereby enjoys a price advantage over the other country. For example, a country may be labor abundant compared to another country that is labor is available at a cheaper rate compared to the first country. Thus it reduces the cost of production for that country. Hence the first country has a competitive advantage over the second country in the supply of labor force....
Role of Supply and demand The market forces of demand and supply are instrumental in determining the price and quantity at which the trade between the buyers and sellers would take place. The market equilibrium will be achieved at the point where the quantity demanded will be equal to the quantity supplied (Pindyck and Rubinfeld, 2001). In the above figure the downward sloping graph depicts the demand for a good in the economy and the upward rising curve is the supply curve. At the equilibrium point the price at which the good is supplied is P* and the quantity demanded is Q*. Answer 2 The Laissez-faire theory has come from this concept in which there is opportunity for free entry and exit and the government does not impose any restriction on the functioning of the markets. On the other hand in the mixed economy the ownership of the means of production is shared between the government and the private players. In such economies the government has significant control over the economic variables though the capital accumulation is done mainly by the private sector (Conklin, 1991). The socialist economies are almost contradictory to these economic systems. In such a kind of economy the ownership of the factors of production remains with the general public. Such a kind of economic system is a planned one and the decision of allocation of the resources remain with the government. So the demand and supple forces are less significant in case of the socialist economies. Answer 3 If a particular business has abundant resources that it needs for its production them the company would be able to make huge profits compared to the other companies. For example, suppose a company that produces cloth has greater access ...Download file to see next pagesRead More
Comments (0)
Click to create a comment or rate a document
Demand and supply theory
Economists are in agreement that prices and quantities are descriptively the most observable attributes of individual interests that interact within a market structure to facilitate a mutually beneficial exchange as envisaged by Adam Smith (Friedman 145).
4 Pages(1000 words)Term Paper
Supply and Demand
There are four primary laws of supply and demand. First, if demand rises and supply remains unaffected, there will be a shortage causing a higher equilibrium cost. Second, if demand lessens and supply remains unaffected, there will be a surplus causing a lower equilibrium cost.
3 Pages(750 words)Term Paper
The supply and demand of Crude Oil
The rising costs are an outcome of the general level of inflation in the countries of Europe. Many big companies, particularly those, that are conducting operations across several countries in the world are now carrying out researches aimed at weighing the probable influence of the theatrical increase in prices of crude oil on their businesses (Wilson, 1975).
8 Pages(2000 words)Term Paper
Affects of Supply and Demand on Business
The core intentions of any business venture are to supply the market with goods and services in the right quantities of demand;maximize profit and explore measures to necessitate growth and expansion.The process of growth and expansion is purely determined by the business’ performance over a given period of time;its ability to handle micro economic environment and match them with the macro economic factors,and the overall behavior and response of the market.Market forces on the other hand determine the quantity to be produced and supplied by manufacturers and retailers respectively,and depending with the industry that the firm is in, the overall business environment can be explicitly define
4 Pages(1000 words)Term Paper
The concepts related to supply and demand
Elasticity of demand has also been explained in the paper. In economics, supply and demand are two important concepts that define the operations of a business. Demand for a commodity refers to the availability of ready market or
5 Pages(1250 words)Term Paper
It concludes by offering my own opinion about aggregate demand and supply curves. An economy’s demand and supply according to classical macroeconomists is determined by prices of goods
7 Pages(1750 words)Term Paper
Demand and Supply Analysis
Consumers must have sufficient purchasing power to no effect on the use of scarce resources. Understanding ceteris paribus is the key to understanding much of microeconomics. Many
3 Pages(750 words)Term Paper
Macroeconomics - Supply And Demand
These are prices, speculation, government policies, tastes and preferences, and changes in income. Supply and demand in economics are two concepts, which carry a lot of significance as they determine the
7 Pages(1750 words)Term Paper
Aggregate demand and aggregate supply
Real values of GDP are adjusted for inflation, but nominal values of GDP are not so adjusted, and therefore the nominal GDP may appear to be higher than the real GDP. Real GDP refers to the total market values of the outputs measured in constant prices, but not
3 Pages(750 words)Essay
Demand, supply, and equilibrium
Demand and supply are the fundamental concepts used in economics. The factors of demand and supply form the backbone of the market economy. Demand is the measurement of
7 Pages(1750 words)Term Paper
Let us find you another Term Paper on topic Aggregate supply and demand for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us