Explain the forces of demand and supply?

Question

(business related)

Answer 1

Demand is the desire to purchase, supported by an ability to pay.

Supply is the activities of firms that organize the factors of production to produce output and make it available to buyers.

To understand what influences these, I would recommend this video: http://www.youtube.com/watch?v=qdOqAWo8v...

Answer 2

The definition of demand is: the willingness and ability of a consumer to consume a good or service. For an example I will use a Lamborghini car. Personally I would be willing to buy a Lamborghini as I think they're nice cars, however I am not able to buy one as my income isn't great enough. Therefore I am not demanding a Lamborghini. However a multi-millionaire will have enough money to buy a Lamborghini and if he is willing to buy one then he is demanding a Lamborghini.

The definition of supply is: the willingness and ability of a firm to supply a good or service. For example Tesco (or Wal-Mart for the US readers) might see that oil prices are high and be willing to extract and sell oil. However they are unable to do so as they do not have the capital equipment available to do so. Therefore they will not supply the good. However Shell and BP do.

In economics these are expressed as curves that shift and where the curves meet is the equilibrium which defines how much of a good will be produced and what the price per unit of that good will be. To be honest if I were to go into all the factors that influenced demand and supply I would be here all day. Instead you can check out the Wikipedia link below or if you want to read about it I recommend the textbook 'Microeconomics' by Jeffrey Perloff. A third option is to send me your email address and I have some lecture notes you can have.

Hope that helps.

Answer 3

Demand: Income, Prices of related goods, Tastes, Expectations, Number of Buyers.

Supply: Input Prices, Technology, Expectations, Number of Sellers.

These are factors that will result in a shift in D or S... These are the factors im assuming your asking about?