Nobody downloaded yet

The concepts related to supply and demand - Term Paper Example

Comments (0) Cite this document
Summary
The concepts discussed include; the law of demand as well as the law of supply and equilibrium price. Diagrams have been used in the essay to represent the demand and supply curves as well as to explain the concept…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97.9% of users find it useful
The concepts related to supply and demand
Read TextPreview

Extract of sample
"The concepts related to supply and demand"

Download file to see previous pages This can be affected by various changes in the economy for example inflation, fashion etc. Supply is the term used to refer to the availability of a commodity in the market. The demand and supply of a commodity exhibit a high correlation which is determined by price (Fisher 2007 p 15). The law of demand states that; the lower the price, the higher the demand but under normal circumstances. On the other hand, the law of supply states that an increase in the price of a commodity results to an increase in its supply. This essay is an evaluation of the various concepts of supply and demand.
The law of demand states that the lower the price of a commodity, the higher its demand (Fisher 2007 p 20). This means that the prices of items determine the willingness of a customer to buy an item. This rule though has its exceptions which may involve circumstances that may result from quality and quantity. In that aspect, a customer may refuse to buy an item for example a vehicle which is cheap but which is highly depreciated even though it may be selling at a lower price than a new one.
The quantity of the item being bought may also influence the customer towards buying a commodity due to the requirements he may be wishing to satisfy (Gorman 2003 p 14). For example, a packet of fertilizer may be selling at a price of $30 for 50 Kg. A similar bag of fertilizer may also be selling at a cheaper price but in a 30 Kg package. In this case, the demand for the 50 Kg package would not be affected since the consumer would be buying according to the vastness of the area the fertilizer is to be applied. However, the law of demand under the normal circumstances can be represented on a demand curve, whereby the effects of price change on demand can be represented.
This curve shows the difference in the quantity demanded as compared to the price change. When the price is at the lowest i.e. P1, the demand becomes high i.e. Q3. When the prices are high i.e. P3, the ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“The concepts related to supply and demand Term Paper”, n.d.)
The concepts related to supply and demand Term Paper. Retrieved from https://studentshare.org/miscellaneous/1558754-the-concepts-related-to-supply-and-demand
(The Concepts Related to Supply and Demand Term Paper)
The Concepts Related to Supply and Demand Term Paper. https://studentshare.org/miscellaneous/1558754-the-concepts-related-to-supply-and-demand.
“The Concepts Related to Supply and Demand Term Paper”, n.d. https://studentshare.org/miscellaneous/1558754-the-concepts-related-to-supply-and-demand.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
MicroEconomics Supply and Demand
...to become stronger in the times to come. The global players in the chocolate business have already taken cognizance of this fact. Graphical Analysis During the regular season, the demand for chocolate in Japan, as any other perishable consumer good is price elastic and follows the classic law of demand. As the Price of chocolate increases from P to P’, the demand for chocolate falls from D to D’. Besides, people start opting for local substitutes like Wagashi. Price of Chocolate P’ P D1 D’ D Units of Chocolate During the Valentine season, the things are different. The increase in the demand for chocolates moves the demand curve up along the...
3 Pages(750 words)Essay
Demand and Supply Analysis
...demanded and supplied of the commodities in Tanzania is composed of food and food products. The agricultural products also add to the supply of food into the economy (Tucker, 2008). Consumers in developing countries with relation to food are related to then food prices and their income. Rise in income in such countries leads to an increased consumption. Changes in prices also threaten the food consumption patterns in such countries. The only food consumption that is not threatened is that of basic staple foods. This implies that there is high purchase of foods and foodstuffs in Tanzania than the same is for the US. High purchases are realized in staple...
5 Pages(1250 words)Essay
Supply, Demand and Easyjet
...? Supply, Demand and Easy jet Contents Introduction 3 Role of Pricing 3 Easy jet Fares 5 British Airways Fares 7 Comparison of Fares between Easy Jetand British Airways 9 Reference 10 Introduction Marketing is termed as the process of planning and executing the idea, price, promotion and the channels of distribution of goods and services and also of ideas which tends to satisfy the organization and the individual (McDaniel & Gates, 1998, p. 3). The main objective of marketing mix is to establish simultaneous action in order to influence the customers and their purchasing decision. The marketing mix constitutes of four components, the product, price, place and promotion (Belohlavek, 2008, p.11). This...
6 Pages(1500 words)Essay
Concepts of Supply and Demand
...? Concepts of Supply and Demand Section/# A. Definition of terms Elasti of Demand The first economic determinant o f supply and demand which will be analyzed is that of the elasticity of demand. This term most closely relates to the demand for something that is driven and provided for by the changes in the item price (Khan, 2012). In other words, the willingness of the buyer to seek the given good or service is a direct and measurable result of the pricing at which the given item is offered. Figure 1.0 below shows in detail what the elasticity of demand portends for the...
10 Pages(2500 words)Essay
Demand and supply theory
...position. The theory of demand and supply is used to analyze the behavioral aspects in a competitive market structure only as a standard model. The theory can, therefore, be extended to a wide array of explanations of variables within the economy such as the relations between GDP and inflation and that between the wages and labor services. Work cited Friedman, Milton. Price Theory. New Brunswick, NJ: Transaction Publishers, 2009. Print. Gandolfi, Arthur, Anna Gandolfi, and David Barash. Economics as an Evolutionary Science: From Utility to Fitness. New Brunswick: Transaction Publishers, 2002. Print. Samuelson, Paul A. Foundations of Economic Analysis. Cambridge: Harvard University Press,...
4 Pages(1000 words)Term Paper
Supply & Demand
...?Supply and Demand: An Analysis Although one might be quick to assume that the food and beverage industry, specifically the fast food industry, is one that has a relatively inelastic level of supply and demand, this is only partially true. As will be detailed within this short analysis, there are a number of factors that work on a systemic and local level to differentiate the levels of supply and demand so that even though they may not make wild swings in movement, they are nonetheless nearly continuously in flux. Accordingly, the following analysis will present an argument for the way in which supply and...
3 Pages(750 words)Article
Macroeconomic concepts of Supply and Demand
...? The law of supply and demand is one of the most important and basic principles of economics. The demand of a product can be defined as the amount of a good that the market desires. For instance if in China a company expects to sell 500,000 units of its product then that is considered the demand for that product. The supply on the other hand is the amount of a product that a company can produce. The key factor that affects the behavior described in the law of supply and demand is price. The price of a good is originally determine by the company, but based on the law supply and demand the...
3 Pages(750 words)Essay
Demand & Supply
...Running head: Demand & Supply Impact of scar and choice on the laws of supply and demand. ___________ ________________________ ________________ Impact of scarcity and choice on the laws of supply and demand The classical economics is pillared on the twin concepts of the demand and supply. Micro economics analysis of the consumer behaviour is explained by means of the law of demand and the firm behaviour is explained by means of the law of supply. Law of demand simply states that, ceterus paribus, a consumer would demand less of a good if its price is higher and more of the same good if its price is lower. Ceterus paribus is an omnibus assumption and holds all other factors which might influence... ...
2 Pages(500 words)Essay
Demand & Supply
...in green. The interaction of the demand and supply curve determines the equilibrium prices and quantity demanded in the market. In this particular case the equilibrium price and quantities are P1 and Q1. Now due to the increase in the income of the households, there is a shift in the demand curve. This results in the new demand curve in red. In this particular case as stated in the article the level of supply of housing in Scotland have remained the same. Hence there is an increase in the prices of the housing from P1 to P2. Hence a new equilibrium would be formed at the interaction of the original supply curve and the...
5 Pages(1250 words)Essay
Supply and Demand Concepts
...SUPPLY AND DEMAND CONCEPTS Question Question 2 Demand of tablets increases with reduction in the prices oftablets. On the other hand, the demand for tablet decreases with an increase in prices. In the same case, the supply of tablets increases with the increase in the supply of tablets on the market. The reverse is also true that a decrease in the price of the tablet reduces the supply of the product in the market. Question 3 P* = 12 and Q* = 12000. Question 4 Effects of price floor Price floor is government regulation that set a base price for particular goods. When a price floor is set at 16, is become...
4 Pages(1000 words)Assignment
sponsored ads
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.
Let us find you another Term Paper on topic The concepts related to supply and demand for FREE!
Contact Us