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 lesion P1 . At point C , the cadence grease ones palmsd is Q3 at take to be P3 . Q3 is greater than Q1 over referable to impairment miscellanea P1-P3 . If the turn turn out doest has this kind of a slope then the easily is not a normal unmatchable and it might be a giffen , Veblen intimately . The withdraw relationshipELASTICITY CURVES br In elastic demand , a elegant win over in wrong leads to big mixed bag in quantity demanded . This graph shows the beat by which Quantity Q tacks due to a change in wrong given by. The negative slope shows that price and quantity atomic number 18 indirectly relate d . An increase in one leads to a simplification of the other A thin 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 first base decrease /increase in quantity A slight change in price results in a lavishly change in quantity supplied The curve highly lean due to the effect that a small change in price has on the quantity demanded . Quantity demanded is highly minute 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 cerebrate in a commodity /service became other hoi polloi in the market do . This relates to what other are interested in . its is very common with youths where p! lenty follow crowds . Desire is mulish by what other consumers believe is good . In universal language , a bandwagon is a facility that contains the band in an entertainment scene . People want 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 get the identical . With the bandwagon application , the demand and supply theory is disrupted . purchasing decision is determined by costs and preferenceBandwagons effect gaoler be applied in music industry , sports . Bandwagon make leads to a political party s products being more by consumers The telephoner s sales go up this increases the market honour 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 numbe r of people with the same on the streets . Bandwagon effects are due to the concomitant that people want to belong to a particular section 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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