Supply and Demand

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  • Supply and Demand
    • Factors which directly affect supply
      • Number of producers- More producers, lower price and vice versa
      • Low Business Tax- less revenue lost and more to re-invest
      • Complements- Making other products essential to the other (E.G: Car and Petrol) revenue will increase
      • Climactic Change- Products can be made and shipped in certain weather
      • Technology- better technology can reduce labour costs
      • Cost of production change- Revenue changes depending on the costs of production
      • Expand or Contract- money will be lost or gained depending on which route and how successful it is
    • Factors which affect demand directly
      • Income- people may be able to spend more or less
      • Advertising- Attracts more customers
      • Weather- product's like coats will be demanded more in certain conditions
      • Subsidy- The cost of the product will fall
      • Future demand- People may by more if they believe price will rise in the future
      • Quality- quality will bring repeat business
      • Substitutes- lower prices for similar product will lose the business custmomers

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