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What is it called when the price of a product goes down and the demand goes up?
Wiki User
∙ 14y ago
A deal.
Wiki User
∙ 14y ago
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What are some of the factors that the market price of a product depends on?
if there is high demand for it but little of the product it will ofcourse go up in price and if there's low demand but a lot of the product the market price will go down dramatically
What Distinction between price elastic and price inelastic?
Elasticity is "a measure of responsiveness that tells us how a dependent variable such as a quantity responds to a change in an independent variable such as price." Basically, that means that elastic product's demand is affected by price and an inelastic product's demand is unaffected by price.For example: if a product is elastic, the price goes up and demand goes down, or the price goes down and demand goes up. Examples are electronics, candy and junk food, and even cars.If a product is inelastic, the demand will stay the same no matter the price. Examples are medical supplies.
Does a supply of a product refer to the number of similar products that will be bought at a given time and at a given price?
No. The supply is the number of similar products that are AVAILABLE at a given time and a given price. If the demand for the product at that price is less than the supply, not all the product will be bought (you will have some surplus product). In that case, "the number of similar products that will be bought at a given time and at a given price" represents the DEMAND (not the supply). It's called the law of supply and demand. Here's how it works. If the ratio of demand/supply is constant, then the price should remain constant. However, if that ratio increases, then the price should go up. If that ratio decreases, then the price should go down. If price goes down without changing the supply, then that will likely increase demand, changing the ratio of demand/supply, and resulting in the price increasing. If price goes up without changing supply, then that will likely result in reducing demand, resulting in changing the ratio of demand/supply, resulting in the price going down.
Does the supply of a product refer to the number of similar products that will be bought at a given time and at a given price?
No. The supply is the number of similar products that are AVAILABLE at a given time and a given price. If the demand for the product at that price is less than the supply, not all the product will be bought (you will have some surplus product). In that case, "the number of similar products that will be bought at a given time and at a given price" represents the DEMAND (not the supply). It's called the law of supply and demand. Here's how it works. If the ratio of demand/supply is constant, then the price should remain constant. However, if that ratio increases, then the price should go up. If that ratio decreases, then the price should go down. If price goes down without changing the supply, then that will likely increase demand, changing the ratio of demand/supply, and resulting in the price increasing. If price goes up without changing supply, then that will likely result in reducing demand, resulting in changing the ratio of demand/supply, resulting in the price going down.
A Consumer's demand curve for a product is downsloping because?
As a consumer with a finite amount of resources there is a point where the product will become unattainable after it reaches a certain price. Price goes us, demand goes down, therefore the demand curve is downsloping in relationship to the increasing price.
What is effective demand?
Effective Demand is "the demand in which the consumer are able and willing to purchase at conceivable price" simply saying if the product price is low more will buy if the rates went high the quantity of the demand goes down
Explain the effect on the equilibrium price and quantity if increase in the price in product?
If the price increases it means there is not a lot of product avaible. This is seen when a company can not keep up with demand the tend to raise prices so that demand goes down. This is also seen in with the opposite effects, if a company has too much of a product then they lower prices to increase demand
What is the difference elastic and inelastic demand?
Difference is that inelastic demand people need to have that item no matter what the cost. An example would be insulin for diabetic people. Elastic demand is when someone doesn't need to buy a product if the price changes. Example is ramen noodles. If they cost $100 per packet people wouldn't buy them.
How Can The negative relationship between the quantity demanded of a commodity and its price be explained by the principle of?
Supply and Demand. When the supply of an available product goes up, the price goes down - unless the merchant can do something to increase the demand for the product as well. The "something" is generally "advertising". If the demand for a product goes up, the price will generally also rise, which will either lower demand (fewer people want to pay the higher price) or increase supply (another merchant starts selling an equivalent product).
What is principles of price?
it has to do with supply and demand. if the consumer (which is people like us who buy product off of the shelf of wal-mart or target or the grocery stores) buys alot of this product then the demand is very high. the manufacturers have to make more supply and will raise the price because people are buying it. if no one starts buying the item at the stores then the price will go down because the supply has went up and the demand has went down.
What are the reasons for negative relationship between price and quantity demanded?
Price and demand have an inverse relationship. Therefore, if the price goes up, the demand goes down; the price goes down, the demand goes up.
How does demand affect prices?
If you have lots of product A, and all of your competitors also have lots of product A, you may need to reduce price in order to attract custom to your business and get a head start on your competition. If this process is repeated by all your competitiors, you may need to reduce your price further and so on.The opposite applies when you have lots of product B and your competitors have little or no product B. You could then increase prices as there are few options for the customer, who will have little option but to pay the prices you ask.( To Producer)If you produce product A which is highly demanded in the market you may set your price high, but as the demand of the product decline you will be forced to reduce you price to maintain your costomers.(To Consumers)If a product is sold at a high price then you will buy/demand less quantities(necessary to purchase) but if the price decline then the demand will increase. But this is affected by several other factors, such as necessity of the product, usage of the product (technically we can say ELASTICITY of the product)(Law of Demand)The law of demand states that "the higher the price the lower the quantity demanded, the lower the price the higher the quantity demanded.
