Microeconomics and Behavioural Economics: A Contemporary Economic Analysis

BM533 Contemporary
Economic Analysis

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Describe the law of demand, movement along with the demand curve and change in the
demand curve by using the appropriate diagram........................................................................3
1.2 Define the concept of law of supply with its movement in the supply curve and also
change in the supply curve with the use of appropriate curve....................................................6
TASK 2............................................................................................................................................9
Compare and contrast emerging theories and models in 21st century contemporary economics
with those of the 20th century, and relate both of these to modern business practices...............9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Economics is the concept which drive the human behaviour, reactions & their decisions
that is being faced with the difficulties or the successes. It is the discipline that combine the
history, psychology and polities within the economy. In this, consumer are having integrated
changing demand which is driven from the emerging change within the market. They are having
sufficient purchasing power to buy the particular goods so that they can afford their with better
consideration. FamilyMart Ltd. Is the chosen business organisation for this respective
assessment, it is the Japanese convenience firm which is operating its business as the second
leading chain of stores. Approximately, they are operating with 24,574 stores in different areas
of world. This respective report will cover the concept of demand & supply and also discusses
the movement with the demand curve and supply in the given marketplace. Moreover, this report
will also analyse the emerging theories of 20th ans 21st century and critically evaluate them.
TASK 1
1.1 Describe the law of demand, movement along with the given demand curve & variation in
the demand curve by using the correct diagram.
Demand refers to the choice of the individual for buying the specific commodity and
services, backed with sufficient buyer power in order to buy the particular commodity. There is
no much change in other factors, this only impact due to change in the price of offerings in the
market.
Law of demand
This referred to the state in which opposite relationship has been established in the prices
and the quantity demanded of products & services in the given marketplace and the people are
having sufficient buying power to buy the specific commodity in the target place. When the
prices of commodity rise then the demand for the same products decreases as people do not
purchase goods and services at higher prices, they will always go for affordable goods so that
they can full their needs and wants within the available purchasing power to buy the particular
commodity.

According to the given diagram, it is being stated that the decrease in the given prices
will leads to rise the demand of commodities in the target market as the prices and the quantity is
having the inverse relationship among them. When the price increases from p2 to p23 then he
demand for goods fall-down from q2 to q1.
Following are the elements which impact the demand of the specific commodities and
services which are given below:
 Price of particular commodity: There is indirect connection in the prices & the quantity
demand of comodities & services in the target market. Thus, when the price of the
product increases then the demand for respective commodity decreases in respect to rise
in the price.
 Variation in future expectations: this is defined as the factor which is leading to impact
the entire demand of goods and this is concern to the availability of commodities in the
market. When the consumer is expecting change in the availability of commodities in
near future then the demand for respective good rise and vice-versa. In context to
FamilyMart, when the individual are expecting variation in the prices of the goods in
future then the respective demand of their commodities tends to rise & vice-versa.
 Price of complementary products: These are goods which are being used in
consideration to the other goods as these are totally connected to the another products so