Paper about the economics of Easter - Essay Example

Economics of Easter In any economic system, the nature of the markets, demand and supply of goods and services contribute too much to the overall purchases of the consumer. The demand for the goods and services is influenced by availability of the product, the tastes and preferences of the consumer, seasonality and also it changes due consumers’ income spent on the products. The demand for goods during Easter holidays is high and the prices remain relatively high. As a result, most suppliers tend to increase their production of goods to meet this new demand.

Markets are in reference to the size of demand created and the willingness of the buyer to purchase goods and services based on the capital available. The economics of Easter refer to the utility from a person derived from the Easter holidays. Most people are involved in many activities ranging from goods transportation, visitations of relatives, travelling upcountry, purchase of presents and other goods for domestic consumption. These are all economics of the holidays that depend on the availability of the resources.

People will use more and more money to purchase the items that they need and even those that they do not require. The utility that is derived by individuals differs among the individuals with some undergoing consumer dissatisfaction while other has more utility. The change in consumption patterns of the consumers during Easter holiday will rise due to change in purchasing power of the consumers which is influenced by the season. They will tend to purchase mostly the products which will maximize their satisfaction.

Prices of the commodities will increase because of rise in purchasing power. The economics of Easter holiday are that there will be increase in marginal choice of the consumer for the goods and services he will desire to consume. He or she will have an option of choosing an extra unit to consume. On the other hand side Easter holiday will influence the economy through the increase of supply because the price will tend to hike during this festive season. It’s worthy for the business to increase prices during this occasion because its main objective is profit maximization.

Higher prices indicate that firms can supply the market with more products to cater for the excess demand in the market. Production cost of the firms will rise due to increase in output production; this will be reduced by increase in prices which caters for the extra production cost incurred in production of the extra output. Increase in prices will be an incentive to new entrants in the business. This will lead to economic growth in the economy. Economically increase in cost of production leads to rise of price of raw materials which makes the firm to pay higher wages to its employees seasonally because it temporarily employs worker providing employment.

The economics of Easter holiday to spending of goods and services is that the government will increase its revenues. This is brought by the extra tax charged on the extra unit produced to satisfy the increased demand. Works Cited Micheal, Albert. Production and economic dynamics. New York: Cambridge university press, 1996