1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
pishuonlain [190]
3 years ago
14

In an answer of at least two well-developed paragraphs, provide a definition of the law of demand and explain how it can be used

to determine prices. Provide an example of your own to illustrate this concept.
Business
1 answer:
DanielleElmas [232]3 years ago
6 0

The law of demand states that quantity purchased varies inversely with price. In other words, the higher the price, the lower the quantity demanded. This phenomenon occurs because when consumers' opportunity cost increases, they must give something else up or switch to a substitute product.The law of demand is one of the most fundamental concepts in economics. It works with the law of supply to explain how market economies allocate resources and determine the prices of goods and services.

The Law of Demand in Practice

The "curve" above is simplified as a straight line, but in fact the shape of the curve varies by product. Demand curves are generally concave, reflecting the fact that consumers can become saturated with a given product: How many pairs of underwear can you wear between laundry days? How many cars can you park in your garage (or afford to insure and maintain)? 

It's important to distinguish between temporary and longer-term price changes—particularly in online shopping, with its fine-grained price changes. Consumers might buy more of an item on temporary discount to 1) stock up on nonperishables they will need before the items go on sale again (shirts, for example), 2) make a long-planned purchase at a lower price (a big screen television), 3) get the current model of a product before a new model is released (cars or smartphones), or 4) on impulse.

For longer-term prices, consumers will prefer more quantity at lower prices. The question is whether falling costs enable those lower prices that consumers prefer. This leads to the interaction of the law of demand with the law of supply and the supply curve. In the U.S., as of 2018, the average price of goods excluding food and fuel, had not reached 1995 levels due to technological innovation and global trade's downward pressure on costs.

hope this helps

You might be interested in
Tiger Trade has the following cash transactions for the period.
Valentin [98]

Answer:

1. Ending balance of cash is $31400

Explanation:

<u>1.</u>

Balance of cash at the beginning of the period is $4,300

+Cash received from sale of products to customers $ 36,500  

+Cash received from the bank for long-term loan 41,500

-Cash paid to purchase factory equipment (46,500 )  

-Cash paid to merchandise suppliers (11,300 )  

+Cash received from the sale of an unused warehouse 12,300  

-Cash paid to workers (23,300 )  

-Cash paid for advertisement (3,300 )  

+Cash received for sale of services to customers 26,500  

-Cash paid for dividends to stockholders (5,300 )  

Balance of cash at the beginning of the period is $31,400

<u>2.</u>

Cash Flow Statement

Cash flow from Operating Activities

Cash received from sale of products to customers $ 36,500  

Cash received for sale of services to customers 26,500  

Cash paid to merchandise suppliers (11,300 )

Cash paid to workers (23,300 )

<u>Cash paid for advertisement (3,300 )</u>

Total Cash Inflow / outflow from Operating Activity                               25,100

Cash flow from Investing Activities

Cash paid to purchase factory equipment (46,500 )

Cash received from the sale of an unused warehouse 12,300

<u>Cash paid for dividends to stockholders (5,300 )</u>

Total Cash Inflow / outflow from Investing Activity                             (39,500 )

Cash flow from Financing Activities

<u>Cash received from the bank for long-term loan 41,500</u>

Total Cash Inflow / outflow from Financing Activity                                41,500

Net cash Inflow / Outflow                                                                         27,100

Balance of cash at the beginning of the period is                                   <u>4,300</u>

Balance of cash at the beginning of the period is                                 <u>31,400</u>

8 0
3 years ago
On December 31, 2020, the Bennett Company had 100,000 shares of common stock issued and outstanding. On July 1, 2021, the compan
matrenka [14]

Answer:

$5.31

Explanation:

Earnings per share = Earnings Attributable to Holders of Common Stock ÷ Weighted Average Number of Common Stocks Outstanding

<em>where,</em>

<u>Earnings Attributable to Holders of Common Stock is :</u>

Net Income                                                                       $650,000

Less Preference Stock dividend                                       ($71,000)

Earnings Attributable to Holders of Common Stock      $579,000

<em>and</em>

<u>Weighted Average Number of Common Stocks Outstanding :</u>

Common Stocks at Beginning outstanding                                  100,000

Stocks Sold at Weighted Average (18,000 / 2)                                9,000

Weighted Average Number of Common Stocks Outstanding    109,000

therefore,

Earnings per share = $579,000 ÷  109,000

                                = $5.31

The 2021 basic earnings per share is $5.31.

4 0
2 years ago
The central bank buys $15,000 worth of bonds in the open market from Christopher, who
vladimir2022 [97]

Answer:

(a) What is the amount by which Carla Bank's liabilities have changed?

Carla Bank's liabilities increased by $15,000 (bank deposits are liabilities).  

(b) Calculate the change in required reserves for Carla Bank.

Carla Bank's reserves must increase by $15,000 x 5% = $750

(c) What is the dollar value of the maximum amount of new loans Carla Bank can initially make because of Christopher's deposit?

Carla Bank can loan $15,000 x 95% = $14,250

(d) Based on the central bank's open-market purchase of bonds, calculate the maximum amount by which the money supply can change throughout the banking system.

Money multiplier = 1 / 5% = 20

The money supply has the potential to increase by $15,000 x 20 = $300,000

(e) How will the change in the money supply in part (d) affect aggregate demand in the short run? Explain.

Aggregate demand will increase since the total money supply increases. This should also help to decrease the interest rates and foster investment.

4 0
2 years ago
Michaels plumbing purchased a used van for $3,250. the company made a down payment of $450 and agrees to 24 payments of $150 per
PolarNik [594]
<span> <span>Finance charge can be defined as the amount charged by a creditor to a debtor as borrowing fees or by a seller to a buyer for allowing the buyer to extend the payment period for a certain good/service. In this case, the original price of the car was $3,250. But since Michael's Plumbing was not able to pay the full amount at once, they made a down payment of $450 and later 24 equal installments of $150. In total, the amount paid will be (450+(150*24))= $4,050. The finance charge is what they will pay over and above the initial cash price. This is arrived at by getting the difference as follows $4,050-$3,250= $800</span></span>
7 0
3 years ago
Ted failed to disaffirm a contract during his minority or within a reasonable time after reaching majority. The contract was aut
Vlada [557]

Answer:

Ratified

Explanation:

6 0
3 years ago
Other questions:
  • _____________ is the new-product development phase where hope springs decides that the flavor additive has enough market interes
    10·1 answer
  • How do we provide Every day low price to our customers
    7·2 answers
  • Which of the following is NOT associated with (or does not contribute to) business risk? Recall that business risk is affected b
    14·1 answer
  • Boyd Docker recorded the following transactions during the month of April. Apr. 3 Cash 3,400 Service Revenue 3,400 16 Rent Expen
    15·1 answer
  • Barney bought a small retail business a month ago. He plans to advertise it with the help of billboards and flyers to attract cu
    13·1 answer
  • Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter HD
    15·1 answer
  • When China reformed state-owned enterprises, it tried a new approach to choosing managers: it put managerial jobs up for auction
    9·1 answer
  • Which of the following characterize a manager as being efficient?
    15·1 answer
  • The adjustment for overapplied overhead ______ net income.
    8·1 answer
  • A fully global organization might set up a ________ with a foreign company to create a new, independent company that produces a
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!