country
$20 Bonus + 25% OFF
Securing Higher Grades Costing Your Pocket? Book Your Assignment at The Lowest Price Now!

Principles Of Microeconomics Business

tag 0 Download6 Pages / 1,319 Words tag Add in library Click this icon and make it bookmark in your library to refer it later. GOT IT

Question:

Discuss about the Principles of Microeconomics Business.
 
 

Answer:

Introduction:

The demand for a product depends on a number of factors like the price of the product, the income of the individual, the availability and price of other related commodities like substitutes and complements and the tastes and preferences of the consumers. On the other hand, the primary determinants of the supply of a product is the demand structure in the market, the price of the product, the price of inputs and other intermediate goods used in the production process, the availability of the factors of production required to produce the commodity, etc. (Pindyck and Rubinfeld, 2009). The demand for desktops depends primarily on the price of desktops, the incomes of individuals who can generate the demand for desktops, the availability and price of other related goods like laptops and tablets which act as substitutes and internet, software programs, etc. that would be complementary and also the tastes and preferences of the potential consumers in the market. The supply of desktops will again depend on the ongoing market price of similar desktops in the market, the prices and availability of inputs required in the production process like capital and labour or the price of keyboards and mouse required to be supplied with the desktop (Varian, 2009).

Demand for Desktop

The demand for desktops essentially depends on the price of desktops. When the price of desktops increases, the demand for desktops will fall and vice versa given that the other factors determining demand are constant (Mankiw, 2009).

There is an inverse relationship between the price and the demand for desktops. Hence the demand for desktops with respect to price is represented by the downward sloping demand curve D. When the price was P, the demand for desktops was Q. when price increases to P’, the demand falls to Q’. Hence price determines the demand.

Another primary determinant of the demand is the income of the individuals who generate potential demand for desktops. As the income of consumers increase, the demand for desktops will increase (Varian, 2009). This is shown in the following figure:

As the income of the consumer increases, given the price, the demand curve shifts to the right. This is as shown in the figure by the movement from D to D’. For the same price P, the demand increases from Q to Q’ with the increase in the income. Thus there is a positive relationship between the demand for desktops and the income of consumers.

The demand for desktops will also depend on the price of related products like substitutes and complements. The primary substitute of desktop is laptop (Pindyck and Rubinfeld, 2009). When the price of laptop falls, the demand for desktops will shift to that of laptops. Laptop, as a device, is much more convenient to be used than a desktop. But people still purchase desktops because of the relatively mower price of the same. However, if the price of laptop falls, the demand for laptops will increase and that for desktops will fall. Another remote substitute can be tablets which serve at least some of the purpose. This is shown in the following figure:

A decline in the price of laptops reduces the demand for desktops as represented by the shift of the demand curve from D’ to D. Thus, even when the price of desktops remains the same, the demand for desktops falls from Q to Q’. Consumers will now substitute their purchase of desktops with that of laptops.

Another substitute for desktops will be the same kind of desktops produced by other competitors. Thus when the price fluctuates for one brand, people might shift to purchasing some other brand (Mankiw, 2014).

The complements of desktops may be an internet connection or some software programs that a person needs to use. Individuals primarily purchase desktops to enable the use of internet at home. However, if the cost of internet service is high, then the demand for desktops will fall because the main purpose of buying a desktop will not be solves if people cannot afford to purchase the internet connection (Varian, 2009). Again, let an individual wants to buy a desktop to install some software that he might want to learn. If the price of the software increases, the demand for the desktop will also increase again because the main purpose of purchasing the desktop will not be fulfilled. This is shown in the following diagram:

The figure is the same as the above case. When the price of internet connection or different software programs increase, the demand for these will fall. This fall in the demand for complementary goods will translate into a fall in the demand for desktops on the part of consumers who want to use both together. This is represented by a shift of the demand curve from D to D’. The quantity demanded of desktops falls from Q to Q’.

Thus cheaper substitute goods reduce the demand for desktops and cheaper complementary goods increases the demand for the same (Pindyck and Rubinfeld, 2009).

 

The demand for desktops is also determined by the tastes and preferences of consumers. The demand changes with changes in the tastes and preferences of potential consumers in the desktop markets. With changing economic conditions, the tastes and preferences of consumers change and hence their demand for desktops will also change. As and when the economy is advancing, there is an evident shift in the demand for desktops because people are demanding more of laptops due to the convenience involved. Hence the demand for desktops will fall.

The supply of desktops fundamentally depends on the price of desktops. When the market price increases, the supply of laptops will also increase as shown in the following diagram:

The curve S represents the supply of desktops with respect to the price. When the price is P, the supply is Q. As the price increases to P’ the supply also increases to Q’. Thus supply is positively relative to the tentative price in the market.

As the demand for a desktops rises in the market, the price increases in order to eliminate excess demand. However, the supply also adjusts in order to meet the increasing demand. Hence, when demand increases, the supply also rises (Mankiw, 2014).

The supply of desktops also depends on the price of inputs such as hardware, screens, etc. and keyboards, mouse etc. The cost of production basically determines the supply of desktops. As the cost of production increases, the supply of desktops will fall and vice versa. Thus is shown in the following diagram:

Given the price of desktops, when the cost of production increases, the supply curve shifts leftwards from S to S’. Thus, the supply of desktops will fall from Q to Q’. The reduction in the supply is due to a rise in the cost of production resulting from rising factor costs.

Conclusion

Thus, the demand and supply of desktops depend on a variety of factors. The changes in the two components will depend on the relative changes in all the given factors. The equilibrium in the desktop market is established when the demand for desktops in the market is exactly equal to the supply of desktops. In that case, there will be no excess demand or excess supply in the market (Varian, 2009). The market structure for desktops thus depends on all the determinants of demand and supply. It will change as and when any of these factors change. Other than the given factors, there will be many other random factors that might affect the demand or the supply on an occasional basis.

 

References

Pindyck, R. and Rubinfeld, D. (2009). Micreconomics. 7th ed. New Jersey: Prentice Hall.

Varian, H. (2009). Intermediate Microeconomics: A Modern Approach. 8th ed. New York: W. W. Norton & Company.

Mankiw, N.  (2014). Principles of Microeconomics. 7th ed. USA: South-Western College Pub.

Download Sample

Get 100% money back after download, simply upload your unique content* of similar no. of pages or more. We verify your content and once successfully verified 100% value credited to your wallet within 7 days.

Upload Unique Document

Document Under Evaluation

Get Credits into Your Wallet

*The content must not be available online or in our existing Database to qualify as unique.

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2018). Principles Of Microeconomics Business. Retrieved from https://myassignmenthelp.com/free-samples/principles-of-microeconomics-business.

"Principles Of Microeconomics Business." My Assignment Help, 2018, https://myassignmenthelp.com/free-samples/principles-of-microeconomics-business.

My Assignment Help (2018) Principles Of Microeconomics Business [Online]. Available from: https://myassignmenthelp.com/free-samples/principles-of-microeconomics-business
[Accessed 09 July 2020].

My Assignment Help. 'Principles Of Microeconomics Business' (My Assignment Help, 2018) <https://myassignmenthelp.com/free-samples/principles-of-microeconomics-business> accessed 09 July 2020.

My Assignment Help. Principles Of Microeconomics Business [Internet]. My Assignment Help. 2018 [cited 09 July 2020]. Available from: https://myassignmenthelp.com/free-samples/principles-of-microeconomics-business.


MyAssignmenthelp.com delivers assignment help to millions of students of USA. We have in-house teams of assignment writers who are experts on wide ranges of subjects. We have appointed teams of native writers who provide assignment help to students in New York City and all over the USA. They are skilled assignment writers who successfully cater to search terms like do my assignment in the USA

Latest Economics Samples

SBLC4004 Economics For Business Specification

Download : 0 | Pages : 11
  • Course Code: SBLC4004
  • University: University Of Wales Trinity Saint David
  • Country: United Kingdom

Answer: Introduction The analysis of housing market of UK is an interesting aspect for several reasons. Housing market in UK holds a pivotal position in the economy. As compared to other European nations UK has a much higher owner occupation rate. In 2011, UK’s owner occupation rate was 70% as compared to a rate of 45% in Germany and 56% in France. The housing price in UK has constituted a steady upward trend in the last few years. The ...

Read More arrow Tags: United Kingdom London Management Business & corporate finance University of London 

ECF3120 Consumer Economics

Download : 0 | Pages : 7
  • Course Code: ECF3120
  • University: Monash University
  • Country: Australia

Answer: Background of the study The topic for the proposal is the apparel consumption in Australia. The rise in online apparel retailing is taking away the profits of the local retail apparel shops in Australia. The apparel retail comprise of the sale of women’s, men’s and infant’s wear. The revenue growth from the online retail business is about 15.1 percent which is a threat for the local retailers as customers are shiftin...

Read More arrow Tags: Australia 6 Consumer Economics Monash University 

HI5003 Economics For Business 34

Download : 0 | Pages : 3

Answer: 1. (A) Name of point B is inefficient. Name of point A is efficient. Name of point D is unattainable. 10 units of machinery is the opportunity cost of producing 10, 000 more tons of rice when the economy of Nepal is operating at point T. (B) (B1) Discovery of fertilizer would increase the output of rise given the amount of other things will take the economy of Nepal to PPF2. (B2) Discovery of steel would increase the production of ...

Read More arrow Tags: Australia 6 economics for business Holmes Institute 

POLI1095 Evidence Policy And Practice

Download : 0 | Pages : 6
  • Course Code: POLI1095
  • University: Royal Melbourne Institute Of Technology
  • Country: Australia

Answer: Impact of COVID-19 on the Australian economy Australia is renowned as the fourteenth largest economy in the world that has the total Gross Domestic Product of about 1.69 trillion Australian dollars in 2019. It follows a mixed market economy which is one of the most developed in the world. The economy has already faced an economic loss due to the bush fire that took place in the beginning of 2020 and had been struggled to balance its e...

Read More arrow Tags: Australia 6 Evidence  Policy and Practice Royal Melbourne Institute of Technology 

MAE203 The Global Economy

Download : 0 | Pages : 6

Answer: 1a.   Figure 1: Trend in monthly cash rate in Australia (Source: rba.gov.au 2020) The trend in monthly cash rate target of Australia shows that there is an overtime declining trend. In order to give the economy necessary stimulus through monetary policy, Reserve Bank of Australia continuously lowered the cash rate with cash rate declines sharply from 14.00 in August 1990 to 0.75 in January 2020. RBA adjusted the cash rate with...

Read More arrow Tags: Australia 6 the global economy Deakin university 
Next
watch

Save Time & improve Grade

Just share Requriment and get customize Solution.

question
We will use e-mail only for:

arrow Communication regarding your orders

arrow To send you invoices, and other billing info

arrow To provide you with information of offers and other benefits

1,358,337

Orders

4.9/5

Overall Rating

5,081

Experts

Our Amazing Features

delivery

On Time Delivery

Our writers make sure that all orders are submitted, prior to the deadline.

work

Plagiarism Free Work

Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

time

24 X 7 Live Help

Feel free to contact our assignment writing services any time via phone, email or live chat.

subject

Services For All Subjects

Our writers can provide you professional writing assistance on any subject at any level.

price

Best Price Guarantee

Our best price guarantee ensures that the features we offer cannot be matched by any of the competitors.

Our Experts

Assignment writing guide
student rating student rating student rating student rating student rating 5/5

230 Order Completed

97% Response Time

Liya Han

Master Of Science in Geotechnical Engineering (MSc Geotec)

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2279 Order Completed

97% Response Time

Zachary Perez

PhD in Computer Science and Information System

Washington, United States

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

265 Order Completed

97% Response Time

Ken Campbell

MSc in Electrical Engineering

Wellington, New Zealand

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2632 Order Completed

100% Response Time

Albert Ambrosio

MSc in Nursing

London, United Kingdom

Hire Me

FREE Tools

plagiarism

Plagiarism Checker

Get all your documents checked for plagiarism or duplicacy with us.

essay

Essay Typer

Get different kinds of essays typed in minutes with clicks.

edit

GPA Calculator

Calculate your semester grades and cumulative GPa with our GPA Calculator.

referencing

Chemical Equation Balancer

Balance any chemical equation in minutes just by entering the formula.

calculator

Word Counter & Page Calculator

Calculate the number of words and number of pages of all your academic documents.

Refer Just 5 Friends to Earn More than $2000

Check your estimated earning as per your ability

1

1

1

Your Approx Earning

Live Review

Our Mission Client Satisfaction

I really got good marks in that assignment, I wish you guys keep working like that to solve student problems with reasonable price. Thanks wkjkljtwoitqw ewrwiouie weu quie weuqwueit

flag

User Id: 401482 - 09 Jul 2020

Australia

student rating student rating student rating student rating student rating

Great work, i will recommend you to my friends and surely use your service again. Great references and APA format.

flag

User Id: 81173 - 09 Jul 2020

Australia

student rating student rating student rating student rating student rating

Worest report, they didn’t know the anything. At least they don’t read the template and waste of money and time

flag

User Id: 451873 - 08 Jul 2020

Australia

student rating student rating student rating student rating student rating

GOOD SERVICE BUT NEED TO WORK ON TIME LIMITS. THAT\'S IT. JUST NEED TO SUBMIT ON TIME.

flag

User Id: 283077 - 08 Jul 2020

Australia

student rating student rating student rating student rating student rating
callback request mobile
Have any Query?