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By September the gravity of the deterioration in stock prices was so much that Facebook’s stock fell to below $20 (an all time low), Groupon’s share’s depressed to $6.41 and Zynga toppled to $2.75. The stock performances of these three sites: Facebook Inc., Groupon Inc., Zynga Inc., have seen the same tragic degeneration. (Rex Crum, 2012)
Though some investors showed alarm at the trend the three media stocks were trading, financial experts and analysts believe that the regression is due to the expiry of the lockup period. Before a company goes public the employees and managers of the company are offered some shares. A lockup is intended to stop insiders from selling their shares too quickly in the market and therefore flooding the stock market, creating excess supply and falling stock prices. While the concept of lockup is essentially straightforward it has grown complex over the last half a decade. In the superficiality of Silicon Valley, IPO lockups have increasingly digressed from the standard 180-day mark. Zynga, for example shortened its lockup period by 2 months. Facebook’s lockup, on the other hand, has proved even more multifaceted. On August 16, original investors (except Mark Zuckerbeg) was allowed to trade their stocks, from October 16th-November 14th employees and managers could sell shares if they summed up to $247 million and by 14th November 1.2 billion Facebook shares were floating in the market and Mark Zuckerbeg was permitted to offer 60 million of his own shares. (Wall Street Journal, 2012)
Furthermore, a Citigroup analyst unearthed that after the IPO lockup expired in mid-August this year the volume of Facebook’s shares jumped by 42%, and by the stretch that November’s lockup will terminate Facebook will have an aggregate of 280% more shares moving in the stock market.
Before the three companies went public there was no talk of Facebook’s incapacity at making rapid technological changes
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Dr. Mukund further elaborates that a change in the equilibrium of supply and demand of money often results to a drastic change in the balance between supply and demand of commodities. Within the same field of economics, the supplier and consumer are vital in the equilibrium of supply and demand of both money and commodities (Mahajan Mukund 23).
Demand on the other hand defines the willingness of buyers to purchase a commodity in the market at a certain price. Price, therefore, can be termed as one of the key factors that determine the supply or demand for commodities in the market (Fisher 22). This is due to the fact that the sole intention of suppliers is to make maximum profit while that of consumers is to acquire items, which they can afford.
Ceterus paribus is an omnibus assumption and holds all other factors which might influence consumer's demand as constant for the purpose of analysis. These factors may include income of the consumer, tastes of the consumer, impact of fashion and style, peculiar consumer characteristics like miserliness, scarcity of good and other choice patterns in consumer behaviour.Under these assumptions the price and quantity demanded are shown as inversely related and the graphical representation of consumer data in this scenario results in a downward sloping demand curve.
Marshall's theory of demand and consumer surplus is to be understood within this context, as are criticisms, or critiques, of it. To understand Marshall's conceptualization of the demand curve and consumer surplus, it is necessary to understand his theory of supply and demand and his classification of markets.
The Law of demand states that there is a negative relationship between price and demand. This means that whenever price increases quantity demanded falls and when the price fall quantity demanded decreases. The quantity demanded depends not only on price but also on other factors as well.
Then the basis of pricing in each market is discussed. The demand-supply gap is then discussed. In a sellers market, pricing of oil is done through three main aspects viz- Value of equivalent human energy, Sustainable energy creation costs, Affordability of the least rich marginal consumer.
With the improved technology, life is easiertoday. Travelling today is easier and we can share our opinions which too, have evolved. Fighting diseases is possible with vaccination, the computers have made
The reason for the decline in price of crude oil is the “Growing U.S. production, coupled with reduced demand, is [the] key reason oil prices have slumped more than 30% since mid-June” (Friedman, 2014). The growing production in the US is due to the increase production
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