Supply and Demand Analysis for Consumer Retail Demand

Economics for Business

EXECUTIVE SUMMARY
This report summarised the supply and demand analysis which includes the main factors that
determined the positive as well as negative shift. It is linked with consumer demand for retail
goods & services. With the help of it, organizations are able to make their production or strategic
decisions related to consumer demand. In addition, this report also contains information about
economics or government policies which is used to influence the consumer spending in UK.
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EXECUTIVE SUMMARY 1
INTRODUCTION 3
MAIN BODY 3
TASK 1 3
Using supply and demand analysis, identify the main factors in determining the positive and
negative shifts linked to changes in consumer demand for retail goods and services 3
TASK 2 8
Identify and explain the main UK governmental and economic policies that could be used to
influence consumer retail spending in the United Kingdom 8
CONCLUSION 10
REFERENCES 11
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INTRODUCTION
Business economics is indeed an area of knowledge economics that studies the economical,
operational, economy-related, and environmental problems faced by companies (Brennan, 2018).
Company economics covers topics including the idea of scarcity, commodity variables,
distribution and consumption. Companies deals with much of the issues faced by a leader or an
organization. The reach of the economy is therefore broad. Although an organization can deal
with internal or operational as well as external or environmental concerns, there are various
economic theories that relate to it such as demand and supply analysis. This assessment covers
several topics such as supply and demand analysis which include some factors that determined
the positive and negative shift regarding retail goods & services. In addition, discusses the
government policy which is used to influence the UK’s consumers in retail sector.
MAIN BODY
TASK 1
Using supply and demand analysis, identify the main factors in determining the positive and
negative shifts linked to changes in consumer demand for retail goods and services
The principle of supply and demand is a concept that describes the relationship
among sellers and buyers (Brenner, 2018). The theory describes the influence of the relation
between the price of the commodity and people's desire to spend or sell the product. Usually,
when prices rise, people are able to supply even more demand less and vice versa when prices
decrease.
Law of Demand: It is among the most basic principles of economics. t functions with law
of supply to clarify how economic systems distribute capital and decide the prices of commodity
that they experience in day-to-day transactions. According to the law of demand, the quantities
bought vary inversely according to change in price. In other words, the higher the product price
forces consumers to purchase low quantity. This is due to a declining marginal utility.
The below mentioned chart shows the law of demand which indicates that as the price of cars
fluctuates demand also varies at different price segment.
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