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Ecomonics - Coggle Diagram
Ecomonics
Determinants of Demand
Income
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Inferior goods
If a product is considered to be inferior, then demand for the product will fall as income rises and the consumers start to buy higher priced substitutes in place of inferior goods.
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Technology
Improvements in technology can reduce production costs, allowing suppliers to produce more at a lower cost.
Input prices
If input price go down, supply can increase
If input prices go up, supply decreases
Government regulation
Government regulation influence the number of suppliers in the market which increase or decrease market supply.
Government regulation can take the form of taxes, tariffs, subsidies and quotas.
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Factors of production
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Labour
human factor, physical and mental
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Basic economic problem
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Supply
The amount of a resource firms, producers, labourers, providers of financial assets, or other economic agents that are willing and able to supply the market with goods.
Demand
quantity of a good or service that consumers are willing and able to purchase at a given time period
Law of demand
when the price of a product falls, the quantity demanded of the product will usually increase BUT the quantity supplied for the product will usually decrease.