Sri Lanka expects fruit and vegetable exports to grow in 2012
Micro Economics
Sri Lanka expects fruit and vegetable exports to grow in 2012
Supply and Demand Model
Pemila Gunasekera
ID Number: 00002073
12/10/2012
Introduction
This article is based on exceeding demand for fruits and vegetables in Sri Lanka and exports will grow in 2012. Bellow explanation is about the demand and supply model we learned in the Micro economics class and how to relate the article to the concepts what we have learnt in the class.
What is Demand & Supply
Supply and demand is the most basic concepts of the economics and it is the fundamentals of economic concepts and the most important concept to learn. Demand refers to how much capacity of a product or service is preferred by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price; the relationship between price and quantity demanded is known as the demand relationship. Supply represents how much the market can offer. The quantity supplied refers to the amount of an assured good producers are willing to supply when receiving a certain price. The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand.
The relationship between demand and supply underlie the forces behind the allocation of resources. In market economy theories, demand and supply theory will allocate resources in the most efficient way possible.
The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good. In other words, the higher the price, the lower the quantity demanded. The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, so does the opportunity cost of buying that good. As a result, people will naturally avoid buying a product that will force them to forgo the consumption of
Sri Lanka expects fruit and vegetable exports to grow in 2012
Supply and Demand Model
Pemila Gunasekera
ID Number: 00002073
12/10/2012
Introduction
This article is based on exceeding demand for fruits and vegetables in Sri Lanka and exports will grow in 2012. Bellow explanation is about the demand and supply model we learned in the Micro economics class and how to relate the article to the concepts what we have learnt in the class.
What is Demand & Supply
Supply and demand is the most basic concepts of the economics and it is the fundamentals of economic concepts and the most important concept to learn. Demand refers to how much capacity of a product or service is preferred by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price; the relationship between price and quantity demanded is known as the demand relationship. Supply represents how much the market can offer. The quantity supplied refers to the amount of an assured good producers are willing to supply when receiving a certain price. The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand.
The relationship between demand and supply underlie the forces behind the allocation of resources. In market economy theories, demand and supply theory will allocate resources in the most efficient way possible.
The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good. In other words, the higher the price, the lower the quantity demanded. The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, so does the opportunity cost of buying that good. As a result, people will naturally avoid buying a product that will force them to forgo the consumption of