The cost of a product lets us know the quality of that item regarding cash. A sensible customer will attempt to get the best esteem for cash used on products and services. He will then in this method considers and looks at the costs of items before settling on a choice to buy.
Costs in a business economy are controlled by the level of interest and the level of supply for every specific item.
The interest for a specific item is the measure that customers are ready and equipped to purchase at a given cost. The law of interest states that when costs of popularity will fall and when costs are low demand rise. (Importance on all different things remaining unchanged.).
The supply of a specific item is the sum that organizations are ready and equipped to supply at a given cost. The point when costs are high supply wills rise and when costs are low supply fall. Suppliers are willing to offer more at higher costs as benefits will be high, and unwilling to offer substantial amounts when costs fall in low overall revenues.
The equilibrium cost in a specific business sector is the cost at which buyers and suppliers are ready to exchange a certain amount of stocks/products.
a) Use a range of examples to illustrate the relationship between market forces and Organizational responses.
I. Demand – It explains the consumers wants and needs and their willingness to a specific product.
II. Supply – It is sum of goods and services that is to reach to its customers, as customers demand the consumers supply the specific product the customers are demanding.
III. Elasticity of demand – A small large in price leads to a large number of quantity. It is a measurement between a change in quantity demanded for a specific good and the change in the price. Formula – Change in quantity demand / % change in price.
IV. Elasticity of supply – It is the % change in quantity supplied divided by the % change in price. Formula - % Change in quantity supplied / % change in price.
V. Production – The acts of manufacturing a specific product using the resources and raw materials, and is the process of producing.
VI. Cost Curves – It is the total expenses during a production as a production process of total quantity produced; it usually...