Trends In Consumption Patterns

Trends in Consumption Patterns

This article is designed to: 1. define economics, 2. define microeconomics, 3. define law of supply, 4. define the law of demand, and 5. to identify the factors that lead to a change in supply and a change in demand.

Economics is defined as: The social science that deals with the production, distribution, and consumption of goods and services and with the theory and management of economies or economic systems (www.answers .com accessed 02Oct07). Basically I believe that this means that you are trying to interpret how people will react. Economics is broken down into 2 parts Micro and Macro economics.

Microeconomics is defined as: The study of the operations of the components of a national economy, such as individual firms, households, and consumers (www.answers .com accessed 02Oct07). This is a study of the relationship between the consumer and the supplier based on various fluxuations in the market.

The Law of supply is defined as: A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity of goods or services offered by suppliers increases and vice versa (www.answers .com accessed 02Oct07).

The law of demand is described as: A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer demand for the good or service will decrease and vice versa (www.answers .com accessed 02Oct07).

Supply and Demand: The market process is generally modeled using the economic concepts of supply and demand. The plans/desires of consumers are embedded in the concept of demand and the plans/desires of producers in the concept of supply. The plans of these two types of economic actors are brought together in markets, which are the entities in which transactions occur. In a modern economy, markets do not require that the buyers and sellers meet in a geographic place, so markets no longer require actual "marketplaces." (www.answers .com accessed 02Oct07).

The concept of demand represents the market activity of consumers. Demand is defined as the quantity of a good or service that consumers will be both willing and able to purchase at any given price during a specific period of time, holding all other factors constant. Demand is, therefore, a relationship between price and quantity demanded.

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