Wednesday, May 20, 2009
Supply and demand on the Matai Islands
People Supply and People Demand. It is how we manage this that makes markets grow and shrink, this is called Economics. When consumers (demanders) want something more than usual the suppliers have to increase their output to match what thy anticipate they will be able to sell. Companies raise and lower the prices of a product depending on how much consumers are willing to pay for it this is how companies make a profit. Producers have to monitor the "want" of the consumers when output meets input companies can make a good business, this point (shown on the graph) is called the Equilibrium point.