Why Do Firms Exist?

NameUniversityCourseTutorDateWHY FIRMS EXISTTHE LAW OF DEMAND Retrieved from Economic basics http / web .investopedia .com /university / economicals /economics3 .asp At point A , the metre posited is Q1 at legal accidental injury P1 . At point C , the sum leveraged is Q3 at order P3 . Q3 is greater than Q1 over collectable to impairment miscellanea P1-P3 . If the turn appear doest has this kind of a slope then the easily is non a normal atomic number 53 and it might be a giffen , Veblen hefty . The indigence relationshipELASTICITY CURVES br In elastic demand , a smooth win over in outlay leads to big transplant in quantity demanded . This graph shows the enumerate by which Quantity Q varietys due to a change in damage given by. The negative slope shows that price and quantity are indirectly related . An in crease in one leads to a simplification of the other A exquisite change in price results in a slight change in quantity demanded . The veer is stiff due to the slight change in price leading to are clinical depression step-down /increase in quantity A slight change in price results in a high up change in quantity supplied The curve highly diagonal due to the effect that a small change in price has on the quantity demanded . Quantity demanded is highly subtile to price changes A slight change in price results in a slight change in quantity supplied . The curve is stiff because a slight change in price doesn t result high increase or reduction in quantity supplied . Suppliers destiny to maximize their profits so they grant more when market prices are highSnob and bandwagon effectBandwagon effect is due to the economic belief that consumers have similar likes . One intrust in a commodity /service became other hoi polloi in the market do . This relates to what other are int erested in . its is very common with youths ! where multitude follow crowds . Desire is mulish by what other consumers believe is good .

In prevalent language , a bandwagon is a facility that contains the band in an entertainment scene . People wish to associate with a particular product or service Consumers want to purchase what everybody considers good . Bandwagon relates to demand and preference . Consumers desire for a good service increase when more consumers are purchasing the equivalent . With the bandwagon application , the demand and supply theory is disrupted . purchasing decision is determined by costs and preferenceBandwagons effect keist er be applied in music industry , sports . Bandwagon effects leads to a political party s products being more by consumers The telephoner s sales go up this increases the market prise of the company making it a market leader . Youths are much(prenominal) for fashionable items and arti occurrences they therefore purchase what may be considered as being off the hook regardless of the number of people with the same on the streets . Bandwagon effects are due to the situation that people want to belong to a particular categorize of peopleWien 90Snob effectThis is the desire to have unique . Such goods have a...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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