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Assignment on Microeconomic Analysis

Added on - 09 Dec 2020

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Microeconomics articles analysis
ContentsINTRODUCTION...........................................................................................................................3Analysis of Articles.........................................................................................................................31. Demand and supply market equilibrium..................................................................................32. Elasticity measurements and determinants..............................................................................6CONCLUSION................................................................................................................................7REFERENCES................................................................................................................................7
INTRODUCTIONMicroeconomics concept have crucial role in demand and supply of goods in the market.Present report deals with economic analysis of US egg market which has high demand ofcustomers and shortage of quantity supplied is present.Analysis of Articles1. Demand and supply market equilibriumDemand and supply are two factors which effectively decides willingness of customers tobuy goods in the market. The term willingness of customers initiates demand in the marketwhich is affected by various factors mainly is price. In this aspect, law of demand can beenumerated that implies that when price of commodities decreases, quantity demanded increasesand vice-versa. This clearly shows that quantity demanded and price have inverse relationship aswhen factor increases, other one decreases (Baumol and Blinder, 2015). Non-price factors leadto change in market demand of the products. These includes price of related goods, tastes andpreferences of customers and other factors as well. Supply and demand is the fundamentalconcept of economics.Demand refers to what amount of quantity of product and services desire by customer.And supply is the amount of a certain good producers are willing to supply. The relation betweendemand and supply the forces behind the allocation of resources. The law of demand refers thathigher the price of a good, the lower the quantity demand. If the prices goes down of the goods,higher demanded the goods. The law of supply refers that higher the price, higher the quantitysupplied. In this producers supply more because customer can purchase the product at higherprice.The law of demand results from substitution effect and income effect. The demand curveshows relationship between quantity demanded and goods price. Demand and supply depends onthe market price. So the market price goes down the supply will be high. And the market pricefor a product is high the demand of the product is low. The US eggs market do a market researchfor its company. So when eggs rate high the demand of the egg is low, and when eggs price goesdown its supplied would be high. There are some main factors that change demand these are,income, population, preferences, price of related goods, expected future price (Friedman, 2017).Demand curves goes downward. If the price of a goods remain same but one of the other factor
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