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A Comparative Analysis of the Price Dropping Business

   

Added on  2020-07-22

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Comparative analysis
A Comparative Analysis of the Price Dropping Business_1

Table of ContentsINTRODUCTION...........................................................................................................................1If a business drops its price will it always increase demand-and will it always make moreprofit?.....................................................................................................................................1CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5
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INTRODUCTIONThe main topic is about If a business drops its price will it always increase demand-and will it always make more profit? For this topic, the project report various aspects havebeen covered such as price, customer position, economic growth, Price discount, demand,productivity, profitability etc. which communicate that if the price of commodity willdecrease, there will be increase in demand of product as well as organisation will earn moreprofit.If a business drops its price will it always increase demand-and will it always make moreprofit?There is great impact of change in the price of the product on the demand, thecustomer will always enjoy the decrease price of product, as they will able to purchase morequality at the same amount or at the less than that. The customer will able to purchase morequantity of products that have become cheaper and will not buy those goods which isexpensive for them. The demand function state that there is negative relationship between thedemand and price of the product. Whenever the price of the product will fall, there willincrease in the demand and when the price increase, the consumer will try to shift to othersubstitute and demand for that product will fall. The law of demand state that all the otherfactors which affect the demand will constant other than price. But in the real world there isincome and substitute effect other than price on the demand of the product. If the price of oneproduct rices, simultaneously there will be increase in demand of other that is substituteproducts (The Effects of the Price Change on the Demand of Agricultural Products DuringSummer, 2013). As well as when the income of people rises, they will able to pay more forthe goods and services and the demand rises.There is inverse relationship between the price of commodity and profit of theorganisation. The company who want to earn more profit, they need to attract largecustomers and to generate more leads. In order to achieve that companies need to cut downtheir cost and reduce the price of the product. If price of goods and services will reduce thenthe demand will increase and if the company is able to sell more products, then they willgenerate high revenue. There are some related point which help to understand the1
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