Demand and Elasticity of Demand in the Market for Burger King

MANAGEMENT
ECONOMICS-1

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Describe the business..................................................................................................................3
Identify the demand and market equilibrium..............................................................................4
Determine the elasticity of demand in the market for the given factors.....................................6
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Economy is the system spread over a specific area that revels the nature and the level of
economic activities in that area. It is the wider concept used in economics which includes the
production, consumption, investment and the exchange of goods and services (Burke and
Abayasekara, 2018). Owning to the facts that resources are limited and every organisation is
giving their best in meeting the needs and desired of the individual. Demand and supply are the
two significant components of the market which ensure the existence of the firm in the market.
Burger King is an American chain of hamburger fast food restaurants and their headquarter is in
Miami-Dade country, Florida and the company is founded in 1953. This aim of this report is to
analyse the demand and the elasticity of demand in the market and the effects of certain factors
on them. Moreover, It will analyse the substitution and income effects on the demand and lastly
suggestion will be given for the adopting the pricing policy by the company.
MAIN BODY
Describe the business
Burger king is the multinational fast-food chain which is operating their business across
the world. They are serving in 17,796 locations. They have expanded their menu from a basic
burgers, French fires, sodas and milkshakes to the large and diverse set of products. The
company is operating 40 subsidiaries across the world. They are having franchises in the
different countries but they have faced the huge impact due their one of the franchisers but now
it is becoming one of leading fast-food chain in the world.
Chosen product
The company is offering wide range of foot items such as hamburger, milkshakes, mini
parcels and many more. The chosen product for this report is Hamburger which is typically
considered as the sandwiches consist of one of more patties of ground meat, usually beef which
is sliced under the bread roll or bun. It can be grilled, pan fried, smoked or flame broiled.
Reason for choosing product:
Burger King is known for their best burgers in the world so It would be easy to
understand the market scenario of the company in he large market by understanding the demand
and elasticity of demand in the market. This also helps in identifying the modification or
emerging changes in the eating habits of the people.
3

Identify the demand and market equilibrium
Demand is the desire of the individual for purchasing specific goods and services and
having willing to pay for the consumption of such commodity.
All the factors remain constant as there is inverse relationship between the demand and
the price of the product. In context to Burger King, They are offering fast foods and if the prices
of the burger tends to high then the demand for the Burger decreases and when the price of the
burger tends to decreases then the demand for the burger increases due to change in the factors
available n the existing market. Such factors are Change in substitute goods, change in
complementary goods, income of the consumer, taste and preferences and future expectations.
Change in these factors tends to change in the demand of the goods of services in the target
market.
4