Economic Concepts and Models: Trampoline Profit Issues - Assessment 1

This report analyzes the economic concepts of demand and supply, using the trampoline industry as a case study. It begins with an introduction to economics and highlights the challenges faced by businesses in the global market. The main body of the report discusses microeconomic principles, focusing on how factors like shipping costs and port overcrowding impact the profitability of trampoline companies. Key concepts such as demand, the law of demand, elasticity of demand, supply, the law of supply, and elasticity of supply are explained, with attention given to factors influencing these elements. The report concludes that the supply of trampolines is influenced by price increases and emphasizes the importance of considering demand, supply, and related factors to enhance sales and profitability. The report also includes references to relevant economic literature.

Assessment 1 - Individual Presentation

Article Review - Economic Concepts And
Models
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Contents
• INTRODUCTION
• MAIN BODY
• CONCLUSION
• References

INTRODUCTION
• The study of economic resources along
with their utilization in different
circumstances is termed as economics.
• There are businesses that are emerging
in the global as well as domestic market
which are facing various challenges.
• These issues are required to be
addressed in order to retain stability in
the open market(Gandhi and Nevo,
2021).

MAIN BODY
Trampoline's profit Issues
• One of the renowned news channel that
is BBC has screened an article in one of its
broadcast which showed that the overall
cost of the bigger toys are increasing
because of the rise in the cost of shipping
and overcrowding of the ports.
• The owners of one of the trampoline
companies are aware about the above
situation.

MICROECONOMICS
• Microeconomics is a branch of
economics in which each and every
aspect that affects the market and the
prices of goods and services is being
studied.
• It majorly focuses on the inclination of
a person when they make a selection
according to the changes in the market
trend such as, cost of production,
resources, prices of the goods and
services, supply, demand, etc.

Concepts in Microeconomics
DEMAND
• Demand means the needs and wants
of a person in order buy a particular
product or service which is related
with the purchasing power of that
individual.
• For example- if the price of a specific
good increase than the demand of
that particular product will fall and
vice-versa

Law of demand
• It can be defined as a process in
which the prices and the demand
of the specific product are
inversely related to each other.
• It also takes into consideration
the situations in which individual
has adequate purchasing power in
terms of buying any product in the
targeted market.

Elements which impact the
demand of the particular
commodity
• Price of the commodity
• Income of consumer
• Preferences of buyer

Elasticity of Demand
• The situation in which the changes in
the other elements influence the
demand of the product, like, climate
change, income, price, availability of
any other option, etc.
• The demand curve will also change
and a shift would be seen in the
demand curve from left or right in
terms of increase and decrease in
demand of trampoline in the market.

SUPPLY
• Supply means the availability of
various products and services in the
market for the buyers.
• Further, it also shows the overall
accessibility of the products which is
ready for sale at the specific prices in
the market.
• It determines the profit structure of
the business, that how much sales are
being done in a year by a particular
brand(Chesney, et.al, 2022).

Law of supply
• There is a direct relationship between
prices and the supply of the products.
• Supply will also increase with increase
in prices of the commodity.
• Through this, profitability of a
company would also increase.