Economic Concepts and Models: Understanding Demand, Supply, and Elasticity

This presentation explains the basics of microeconomics and the concepts of demand, supply, and elasticity. It also discusses the factors affecting demand and supply with a case study on trampoline profit issues. The presentation is useful for students studying business environment and economic concepts and models.

Economic Concepts and
Models

Table of Contents
 Introduction
 Trampoline profit issues
 Microeconomics
 Demand
 Elasticity of demand
 Supply
 Elasticity of supply
 Conclusion
 References

Introduction
Economics is the analysis of the scarcity of
resources which are meant to produce the goods and
services so that they can full fill the needs and
demand of the target market. This basically
evaluates the demand and supply in the market and
flow for the same. There are various variety of
complex issues that are emerging in the large
market.

Trampoline's profit Issues
This is being stated from the article of BBC News,
souring prices of trampoline is taking place due to
the increasing shipping cost of the trampoline
around the world. This is being known from the
game retailer who is operating its business in the
market. In context to Outdoor Games, James
Owen is the owner of this company who is
operating in toy retailing industry.

Concept of
microeconomics
It is the study which analyse that what is
likely to happen as the individual make
choice in relation to the certain change which
is related to the price, resources, method of
production and so on. Individual are the
microeconomics subgroup which includes the
seller, buyer and business owners.

Demand
 Demand is defined as the choice of the
individual by which they can buy the particular
products and services and also having the
effective purchasing power to buy the specific
goods and services and also have the capacity
to buy the same.
 According to Law of demand, there is the
indirect relationship in the price & the quantity
of goods in the target market.

Factors affecting demand
Following are the factors which is influencing
the particular demand of trampoline which are
explained as follows:
 Price of the given goods
 Income of the consumer
 Price of related goods
 Taste and preferences of customer

Elasticity of demand
This is also known as the change in the demand
of goods tends to rise in the market due to
change in the various aspects which includes the
income of consumer, prices of given goods,
choices of the buyer and future expectations of
the consumer. When there is the impact of such
aspects on goods then the demand of such goods
tends to fall or rise in the respective market place
and this is being derived from the market.

Supply
Supply is the aspects that analyse the total
available amount of goods and services to their
prospective buyer.
Law of supply:
It is being derived from the large
market pace that the supply is having the positive
consideration in the given prices of goods in the
target market which leads to have the change in
the supply of goods in the target market.

Factors affecting supply
Factors affecting supply of the specific good are
as follows:
 Production cost:
 Government Subsidies
 State of Technology

Elasticity of supply
This is also called as the elasticity of supply due
to the change in the market which directly linked
with the change in the given prices and the
supply of goods & services. As the supply curve
will shift to right as increase in the given supply
of goods in the large market and on other hand
leftward shift in the supply curve tend to slow-
down the overall supply of goods in the market.

Conclusion
From the above PPT, it is being derived that the increasing prices of trampoline
influencing the overall supply and ensuring more profits to the company. Demand and
supply are the two wheels of microeconomics, which is ensuring the effective flow of
goods and services in the target market.

References
 Hofmann, F., 2019. Circular business models: business approach as driver or
obstructer of sustainability transitions?. Journal of Cleaner Production, 224,
pp.361-374.
 Haggett, P., 2019. Changing concepts in economic geography. In Frontiers in
Geographical Teaching (pp. 101-117). Routledge.
Online:
 Trampoline prices 'to soar 50% on shipping costs', 2021 [Online] Available through
<https://www.bbc.com/news/business-55702243>

Thank You