Bibliography Introduction Food expenditure is always a part of our daily spending that cannot be stopped. The markets where we buy food items are always busy and interesting to study.
The demand of a product is influenced by a number of factors. An organization should properly understand the relationship between the demand and its each determinant to analyze and estimate the individual and market demand of a product. For example, the demand for apparel changes with change in fashion and tastes and preferences of consumers.
The extent to which these factors influence demand depends on the nature of a product. An organization, while analyzing the effect of one particular determinant on demand, needs to assume other determinants to be constant.
This is due to the fact that if all the determinants are allowed to differ simultaneously, then it would be difficult to estimate the extent of change in demand. Following are the determinants of demand for a product: Price of a Product or Service: Affects the demand of a product to a large extent.
There is an inverse relationship between the price of a product and quantity demanded. The demand for a product decreases with increase in its price, while other factors are constant, and vice versa.
For example, consumers prefer to purchase a product in a large quantity when the price of the product is less. The price-demand relationship marks a significant contribution in oligopolistic market where the success of an organization depends on the result of price war between the organization and its competitors.
Constitutes one of the important determinants of demand. For example, if the salary of Mr.
X increases, then he may increase the pocket money of his children and buy luxury items for his family. This would increase the demand of different products from a single family.
The income-demand relationship can be analyzed by grouping goods into four categories, namely, essential consumer goods, inferior goods, normal goods, and luxury goods. The relationship between the income of a consumer and each of these goods is explained as follows: Essential or Basic Consumer Goods: Refer to goods that are consumed by all the people in the society.
For example, food grains, soaps, oil, cooking fuel, and clothes. The quantity demanded for basic consumer goods increases with increase in the income of a consumer, but up to a fixed limit, while other factors are constant. The demand for normal goods varies due to.
Refer to goods whose demand decreases with increase in the income of consumers. In such a case, millet and kerosene are inferior goods for the consumer.
However, these two goods can be normal goods for people having lower level of income. Therefore, we can say that goods are not always inferior or normal; it is the level of income of consumers and their perception about the need of goods.
Luxury goods are used for the pleasure and esteem of consumers. For example, expensive jewellery items, luxury cars, antique paintings and wines, and air travelling.
Tastes and Preferences of Consumers: Play a major role in influencing the individual and market demand of a product. The tastes and preferences of consumers are affected due to various factors, such as life styles, customs, common habits, and change in fashion, standard of living, religious values, age, and sex.
A change in any of these factors leads to change in the tastes and preferences of consumers. Consequently, consumers reduce the consumption of old products and add new products for their consumption.
For example, if there is change in fashion, consumers would prefer new and advanced products over old- fashioned products, provided differences in prices are proportionate to their income.
Apart from this, demand is also influenced by the habits of consumers.Diagram 1, the production cycle of a dairy cow.
As you can see the dairy cow should be in milk for around days a year and have a drying off period of around 60 days. After calving the cow should be back in calf after 85 days, this is to keep the ratio of 1 calf/ cow/ year. Determinants of market demand. The market demand curve for a commodity is obtained by adding up the individual demand curves for all economic actors in the market.
Thus, each of the determinants of individual demand is also a determinant of market demand. The demand for a product decreases with increase in its price, while other factors are constant, and vice versa. For example, consumers prefer to purchase a product .
Namely, the non-price determinants of demand and non-price determinants of supply. Also, I made calculations on the price elasticity of demand and price elasticity of supply for the case of tomatoes. It is turned out that the price elasticity of demand is and price elasticity of supply is The Demand Curve: The Relationship between Price and Quantity Demanded • Demand Schedule • The demand schedule is a table that shows the relationship between the price of .
To analyse the demand pattern of consumptions of the premium ice creams in Metro cities in India caninariojana.com | Page earn this delicious seal of approval, ice cream has to .