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"Economics is the study of how society decides what, how and for whom to produce."
Member rating: No Rating | Words: | Submitted: Mon Jun 19 2006
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"Economics is the study of how society decides what, how and for whom to produce."[1] A market place is where buyers and sellers come together and reconcile their decisions on consumption and production by the adjustment of prices. Demand is the quantity that the buyers in a market place will purchase given a particular price. Supply is the quantity that sellers in a market place will produce given a particular price. Ceteris paribus (all other things being equal) the demand will rise as the price falls. (figure 1) How much the price affects the demand is known as the elasticity. The more elastic a product is the more affect price change has on the demand. Unfortunately, the world is not that simple and there has to be a willingness to demand. This can be influenced in a number of ways. Firstly, there is the price and availability of substitute products....
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