Economics for Business Assignment - Polo mint
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Added on 2020-10-05
Economics for Business Assignment - Polo mint
Added on 2020-10-05
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ECONOMICSFOR BUSINESS
Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONBusiness economics is a field which is applied economics to uses economic theory andquantitative methods to determine business corporation and their factors (Bonilla, Merigó andTorres-Abad, 2015) . These elements are contributing to the diversity of organizational structuresand the relationships of firms with labour, capital and product markets. It is also known asmanagerial economics which can help to decision making process to selecting one out of two ormore optional plan of action. The report going to present demand and supply analysis of polomints. There are selected company Polo mint, which is a brand of breath mint whose describingas a feature of hole in the middle. It is firstly manufactured by employee John Barge-well at theRowntree's factory in 1948, United kingdom. In the report focused on demand and supplyanalysis to identify main factors which can determine the prices of polo mints in the UK. MAIN BODYIn economics, the concept of static states to a situation where there is a movement. Butthis movement is continuous, definite, day-to-day and constant and it can not deal with theunexpected changes because of focus on expected economic studies. Comparative statics isdefines as the comparison of two different economic outcomes which shows change before andafter in some underlying exogenous parameters. These changes show by diagrams to provideclear picture of Polo mint and it can also show demand and supply proper way with the help ofdiagram. The static analysis will compare two different equilibrium states, after the process ofadjustments. For example – when the demand as well as supply of milk is 25 Ltr, price is two Ltrafter than assume that demand of milk increase by 5 Ltr while supply remains the same. So itwill affect to price of milk increase to 3 per Ltr. According to Prof. Stigler, static economic analysis is an economy which can not changeaccording to resources, taste and technology. The pricing of commodities is an importantexample of static economy. There are supposing that the price is determined by the forces ofdemand and supply which belong to equal time period, price, demand and supply refer to thesame time period. There are determining of demand and supply which can suppose to be constantin static economics. Under perfect competition, price is analogising by to factors of demand andsupply (Benavides-Velasco, Quintana-García. and Guzmán-Parra, 2013). This analysis of pricingis related to economic statics. It can explain through static economic analysis - 1
In the presented diagram DD shows as the market demand curve ans SS can shows themarket supply curve. The point of E shows that the quantity demanded and supplied is equal toOM. The price OP is analysed by the interaction of the forces of demand and supply. Accordingto diagram present demand, supply and piece states to the same time period and static economicanalysis which is also known as timeless economic analysis. There are prof. Clark has pointedout the features of a static economy. These are – (1) There are no change in the population andtheir composition. (2) No changes coming in the quantity of capital. (3) Production techniquescan not change. The above chart shows that the point of E which can known as equilibrium point ofsupply and demand and it is shifting from E to E1 and as per the graph demand of the productwill increase that will affect to price of the product. So demand curve can shift from D to D12
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