The law of supply and demand functions only in. Supply and demand - Economic theory (Vasilyeva E.V.). What factors influence the offer

Analysis of the situation of market equilibrium, excess and

The interaction of supply and demand.

The main factor in the change in supply and demand is price. Sellers and buyers, focusing on prices, develop plans for their behavior, and in accordance with them make their decisions about buying and selling goods. However, when they meet in the market, it turns out that, as a result of agreement, supply and demand can change their price and lead it to a compromise agreement, i.e. to the market price.

Market price – this is the price of a compromise, an agreement between the seller and the buyer, the price, by which the product is actually bought and sold. The market price is also called at the cost of balance, because it is at the equilibrium level when the seller still agrees to sell, and the buyer already agrees to buy the product.

In the process of interaction between sellers and buyers, it is possible three options for market equilibrium:

1. The supply of goods exceeds the demand of buyers. This situation can be the result of:

· Excess production of goods;

· Not their high quality;

· Prohibitively high prices for them, colliding with low purchasing power of buyers. The resulting discrepancy, as a rule, leads to crisis situations... The solution to this problem can be: lowering prices, reducing the volume of production, improving the quality of products, improving distribution relations and regulating income.

2. Demand exceeds supply ... Unsatisfied consumer demand is the result of exorbitant price increases. People are looking for an application for their money. As a result, there is intense competition between buyers for the right to purchase the missing goods. Commodity prices are rising. In this struggle, those buyers who have higher incomes win.

3. Equilibrium of supply and demand . It characterizes the general and partial correspondence between the volume and structure of demand for goods, on the one hand, and the volume and structure of supply, on the other, as a result of which they are balanced.

The created equilibrium indicates that the market offers so many goods and in such an assortment that fully satisfy the demand and are available to the buyer at the offered prices. But, as a rule, such a correspondence is practically rare. Manufacturers usually differentiate goods, putting them up for sale at different prices, based on different levels of purchasing power, therefore, for the same product in the sales market, as many equilibrium points between supply and demand are formed as there are correspondences between them.

To establish the market price, we will combine the previously considered graphs of demand (Fig. 6.1.1.) And supply (Fig. 6.2.1.). Both of these graphs depict in each case the quantity of goods depending on the price level (Fig. 6.3.1.).

The level of intersection of the supply and demand curves (point A) determines the level of the market price. Point A is called the equilibrium point, and the price (F) is called equilibrium. This is really a balancing price, because any other point of intersection of the curves means a disproportion between effective demand and the corresponding product supply.

If the market the price will become below equilibrium , will decrease to the level (K), then the number of buyers will increase at the expense of those persons who could not afford the price at the level of point F. Consequently, demand will also increase (up to OE). But a decrease in the market price (from F to K) will reduce the number of sellers at the expense of those for whom this price is unacceptable, since it does not even reimburse the costs.

6.3.1. Equilibrium price.

As a result increased demand (OE) will be opposed by a much smaller supply of goods (OL). Arises shortage of goods (in Fig. 4 it is equal to the segment LE).

When under the influence of demand, the market price will rise equilibrium and will rise to level (R), then the number of sellers will increase at the expense of those who have high costs. Hence, the supply will also increase(DE will be added to OD). But now the market price increase (from F to R ) will reduce the number of buyers (from OD to OL) at the expense of those for whom this price will become unaffordable. As a result, the increased supply (OU) will be opposed by a much smaller solvent number of buyers (OL). Overproduction occurs , excess of goods (in Fig. 6.3.1 it is equal to the segment LE).

Thus, the equilibrium price is the price at which the amount of demand coincides with the amount of supply. If the price rises above the equilibrium point, it will stimulate an increase in production, which will lead to an increase in the supply of goods and the price of goods will begin to decline, approaching the equilibrium point. Lowering prices, in turn, increasing consumer demand, will help expand production and return to the equilibrium point.

Thus, the market goes competitive fight between the seller and the buyer for a more favorable price for each of them. As a result of this struggle, the price is balanced, i.e. is fixed at a point where the interests of the buyer and the interests of the seller coincide.

It should be noted that the movement of the equilibrium price up or down, i.e. upward or downward, directly affects the well-being of various groups of the population. Therefore, sometimes the state tries to intervene in the process by administrative methods. market pricing, which most often boils down to setting the price at a level below market equilibrium. As practice shows, through state intervention in the pricing mechanism, it has not yet been possible to solve a single problem, both in the economic and social sphere... State control over prices leads to artificial regulation of supply and demand. Setting prices for goods below the equilibrium price creates a market environment that is unfavorable for the producer: the production of goods is low-profit or unprofitable. There is a shortage of goods, and, as a result, goods go into the shadow economy, where prices for them are not only higher than state prices, but also higher than the equilibrium price. Moreover, the turnover of such goods does not allow them to be taxed, and this entails a reduction in state revenues. Under the conditions of such an economy, low-income strata of society are not only not protected by the state, but are even more drawn into the quagmire of economic turmoil: shadow goods become inaccessible to them, and the shortage of essential goods generally gives rise to an ugly distribution system material goods using cards, coupons, coupons, etc. The budget deficit due to the concealment of income by shadow structures further increases the social insecurity of those whom the state should protect.

For any product or service - this is the desire and ability of the consumer to buy a certain amount of goods or services at a certain price in a certain period of time.

Distinguish:

individual demand is the demand of a specific subject;
market demand is the demand of all buyers for a given product.

Demand volume is the quantity of a product or service that consumers agree to buy at a certain price within a certain period of time.

A change in the amount of demand is movement along the demand curve. Occurs when the price of a product or service changes, all other things being equal.

Demand law: other things being equal, as a rule, the lower the price of a product, the more the consumer is ready to buy it, and vice versa, the higher the price of the product, the less the consumer is ready to buy it.

What factors influence demand?

Factors influencing demand:

consumer income;
tastes and preferences of consumers;
prices for interchangeable and complementary goods;
stocks of goods with consumers (consumer expectations);
product information;
time spent on consumption.

With a change in other factors and a constant price of the goods, there will be a change in demand itself. As a result of changes in demand, consumers are willing to buy more (or less) goods than before at the same price, or are willing to pay a higher price for the same quantity of goods.

What is an offer?

Offer any good or service is the willingness of the manufacturer to sell a certain amount of a good or service at a certain price for a certain period of time.

Supply volume- the amount of goods or services that sellers are willing to sell at a certain price within a certain period of time.

The relationship between the volume and the offer price is expressed in supply law : other things being equal, the volume of supply of a product increases if the price of a product increases and vice versa.

What factors influence the offer?

Factors influencing offers:

change in prices for factors of production;
technical progress;
seasonal changes;
taxes and subsidies;
manufacturers' expectations;
change in prices for related products.

A change in the volume of supply occurs if all factors determining the supply of a product remain constant, and only the price of the product in question changes. Thus, if the price changes, then there is a movement along the supply line.

When other factors that determine the supply change and the price of a product is constant, the supply itself changes, and the supply line on the chart shifts.

What is market equilibrium?

The supply and demand lines intersect at the point where the price at which buyers agree to buy a certain amount of a good is equal to the price at which manufacturers are willing to sell that same amount of a good. The point of intersection of the supply (S) and demand lines - point E, is called the equilibrium point. When the market is at this point, both buyers and sellers are satisfied with the settled price and they have no reason to demand a change. This state of the market is called market equilibrium.

The sales volume at this point is called the equilibrium market volume (Qе). The price at this point is called the equilibrium (market) price (Pe).

Thus, market equilibrium- this is the state of the market in which the volume of demand is equal to the volume of supply.

If the price prevailing in the market differs from the equilibrium one, then under the influence of market mechanisms it will change until it settles at an equilibrium level and the volume of demand becomes equal to the volume of supply.

The state of the market is determined by the ratio of supply and demand.

Supply and demand are interdependent elements of the market mechanism, where demand is determined by the solvent need of buyers (consumers), and offer- a set of goods offered by sellers (manufacturers); the ratio between them adds up to an inversely proportional relationship, determining the corresponding changes in the level of prices for goods.

If demand Is the amount of products that the buyer wants and has the opportunity to buy (that is, the solvent need), then offer- this is the amount of goods that sellers are ready to offer at a specific time in a specific place.

Demand is a request from an actual or potential buyer or consumer to purchase a product according to the funds available to him, which are intended for this purchase.

Demand law- the amount of demand decreases as the price of the product increases. That is, an increase in price causes a decrease in the amount of demand, while a decrease in price causes an increase in the amount of demand.

1. The first way- using a table. Let's compile a table of the dependence of the value of demand on the price, using arbitrary numbers taken at random.

Table. Demand law

The table shows that at the highest price (10 rubles), the goods are not bought at all, and as the price decreases, the value of demand increases; the law of demand is thus observed.

Rice. Demand law

Second way- graphic. Let's put the given figures on the graph, postponing the amount of demand along the horizontal axis, and the price - along the vertical axis (Fig. A). We see that the resulting demand line (D) has a negative slope, i.e. the price and the amount of demand change in different directions: when the price falls, demand rises, and vice versa. This again testifies to the observance of the law of demand. The linear demand function shown in Fig. a is a special case. Often, the demand graph is in the form of a curve, as can be seen in Fig. b, which does not negate the law of demand.

In economics, a demand curve is a graph that illustrates the relationship between the price of a particular good or service and the number of consumers who want to buy it at that price.

Excess demand or shortage the accompanying prices below the equilibrium price indicate that buyers need to pay a higher price in order not to be left without a product. The rising price will be:

1) encourage firms to redistribute resources in favor of the production of this product;

2) squeeze some consumers out of the market.

Offer- the ability and desire of the seller (manufacturer) to offer their goods for sale on the market at certain prices.

Supply law: the higher the price of a given commodity, the more producers want to sell it during a given time and other unchanged conditions.

Factors influencing the offer:

1. Availability of substitute products.

2. The presence of complementary goods (complementary).

3. The level of technology.

4. Volume and availability of resources.

5. Taxes and subsidies.

6. Natural conditions

7. Expectations (inflationary, socio-political)

8. Market size

This law can be expressed in different ways:

The first way- using a table. Let's compile a table of the dependence of the value of the offer on the price, using arbitrary numbers taken at random.

Table. Supply law

The table shows that at the lowest price (2 rubles), no one wants to sell anything, and as the price rises, the supply increases; the supply law is thus respected.

Rice. Supply law

Second way- graphic. Let's put the given figures on the chart, postponing the supply value along the horizontal axis, and the price - along the vertical axis (Fig. A). We see that the resulting supply line (S) has a positive slope, i.e. the price and the supply amount change in the same direction: when the price rises, the supply amount increases, and vice versa. This again demonstrates the observance of the law of supply. The linear supply function shown in Fig. A is a special case. Often times, the supply schedule is shaped like a curve, as shown in Fig. b, which does not negate the law of supply.

A supply curve is a graph that illustrates the relationship between market prices and the number of products that manufacturers are willing to offer..

Oversupply, or surplus products prices that arise when prices are higher than the equilibrium price will induce sellers competing with each other to lower prices in order to get rid of excess inventory. Falling prices will be:

1) prompt firms that it is necessary to reduce the resources spent on the production of these products;

2) will attract additional buyers to the market.

Supply and demand are closely related and continuously interacting categories and serve as a link between production and consumption. The amount of demand, both individual and aggregate, is influenced by price and price factors, which should be clearly monitored on an ongoing basis by dedicated departments.

The result of the interaction of supply and demand is the market price, which is also called equilibrium price... It characterizes the state of the market in which the amount of demand is equal to supply.

Elasticity of demand

Price elasticity of demand- a category that characterizes the reaction of consumer demand to a change in the price of a product, that is, the behavior of buyers when prices change in one direction or another. If a decrease in price leads to a significant increase in demand, then this demand is considered elastic. If a significant change in price leads to only a small change in the quantity of the requested product, then there is a relatively inelastic or simply inelastic demand.

The degree to which consumers are sensitive to price changes is measured using the coefficient of price elasticity of demand, which is the ratio of the percentage change in the quantity demanded to the percentage change in price that caused the change in demand.

There are also extreme cases:

Absolutely elastic demand: there can be only one price at which the goods will be purchased by buyers; the coefficient of price elasticity of demand tends to infinity. Any change in price leads either to a complete refusal to purchase goods (if the price rises), or to an unlimited increase in demand (if the price decreases);

Absolutely inelastic demand: no matter how the price of a product changes, in this case the demand for it will be constant (the same); the price elasticity coefficient is zero.

Specific factors that affect the price elasticity of demand is very difficult to distinguish, but some specific traits inherent in the elasticity of demand for most goods:

1. The more substitutes a given product has, the higher the degree of price elasticity of demand for it.

2. The greater the place occupied by expenditures on the goods in the consumer's budget, the higher the elasticity of his demand.

3. Demand for basic necessities (bread, milk, salt, medical services etc.) is characterized by low elasticity, while the demand for luxury goods is elastic.

4.In short term the elasticity of demand for a product is lower than in longer periods, since in long-term periods entrepreneurs can start producing a wide range of substitute goods, and consumers can find other goods to replace the given one.

Demand. Demand law

Demand (D- from the English. demand) is the intention of consumers, secured by means of payment, to purchase this product.

Demand is characterized by its magnitude. Under demand (Qd) it should be understood the amount of goods that the buyer is willing and able to purchase at a given price in a given period of time.

The presence of a demand for any product means that the buyer agrees to pay the specified price for it.

Bid price is the maximum price that the consumer agrees to pay when purchasing this product.

Distinguish between individual and aggregate demand. Individual demand is the demand in a given market of a specific buyer for a specific product. Aggregate demand is the total demand for goods and services in a country.

The amount of demand is influenced by both price and non-price factors, which can be grouped as follows:

the price of the product itself X (Px);
prices for substitute goods (Pi);
consumer cash income (Y);
tastes and preferences of consumers (Z);
consumer expectations (E);
number of consumers (N).

Then the demand function characterizing its dependence on the specified factors will look like this:

The main factor that determines demand is price. The high price of a commodity limits the amount of demand for a given commodity, and a decrease in price leads to an increase in the amount of demand for it. From the above, it follows that the amount of demand and price are inversely related.

Thus, there is a relationship between the price and the quantity of the purchased goods, which is reflected in the law of demand: all other things being equal (other factors affecting demand are unchanged), the quantity of goods for which demand is presented increases with a fall in the price of this product, and vice versa.

Mathematically, the law of demand is as follows:

where Qd- the amount of demand for any product; / - factors affecting demand; R- the price of this product.

The change in the amount of demand for a particular product caused by an increase in prices for it can be explained by the following reasons:

1. Substitution effect. If the price of a product rises, then consumers try to replace it with a similar product (for example, if the price of beef and pork rises, then the demand for poultry and fish increases). The substitution effect is a change in the structure of demand, which is caused by a decrease in purchases of goods that have risen in price and their replacement with other goods with constant prices, since they are now becoming relatively cheaper, and vice versa.

2. Income effect, which is expressed in the following: when the price rises, the buyers become, as it were, a little poorer than they were before, and vice versa. For example, if the price of gasoline doubles, then as a result we will have less real income and, naturally, we will reduce the consumption of gasoline and other goods. Income effect - a change in the structure of consumer demand caused by a change in income from price changes.

In some cases, certain deviations from the rigid dependence formulated by the law of demand are possible: an increase in price may be accompanied by an increase in the amount of demand, and its decrease may lead to a decrease in the amount of demand, at the same time it is possible that a stable demand for expensive goods remains.

These deviations from the law of demand do not contradict it: the rise in prices can increase the demand for goods, if buyers expect their further increase; lower prices can reduce demand if they are expected to fall even more in the future; the acquisition of persistently expensive goods is associated with the desire of consumers to profitably invest their savings.

Demand can be plotted as a table showing the quantity of a product that consumers are willing and able to buy over a given period. This dependence is called scale of demand.

Example. Suppose we have a scale of demand that reflects the state of affairs in the potato market (Table 3.1).

Table 3.1. Potato demand

At each market price, consumers will want to buy a certain amount of potatoes. With a decrease in the price for it, the amount of demand will increase, and vice versa.

Based on this data, you can build demand curve.

Axis X set aside the amount of demand (Q), along the axis Y- appropriate price (R). The graph shows several options for the value of demand for potatoes, depending on their price.

By connecting these points, we get the demand curve (D), which has a negative slope, which indicates an inversely proportional relationship between price and the amount of demand.

Thus, the demand curve shows that, while other factors affecting demand remain unchanged, a decrease in price leads to an increase in the value of demand, and vice versa, illustrating the law of demand.

Rice. 3.1. Demand curve.

The law of demand also reveals another feature - diminishing marginal utility, since a decrease in the volume of purchases of a product occurs not only due to an increase in prices, but also as a result of saturation of the needs of buyers, since each additional unit of the same product has less and less useful consumer effect.

Offer. Supply law

The offer characterizes the willingness of the seller to sell a certain amount of goods.

Distinguish between the concepts: supply and supply value.

Sentence (S- sapply) is the willingness of producers (sellers) to supply a certain amount of goods or services to the market at a given price.

Amount of supply is the maximum number of goods and services that manufacturers (sellers) are able and willing to sell at a certain price, in a certain place and at a certain time.

The amount of the offer should always be determined for a specific period of time (day, month, year, etc.).

Similarly to demand, the supply is influenced by a variety of both price and non-price factors, among which the following can be distinguished:

the price of the product itself X (Px);
resource prices (Pr), used in the production of goods X;
technology level (L);
company goals (A);
the amount of taxes and subsidies (T);
prices for related goods (Pi);
manufacturers' expectations (E);
number of manufacturers of goods (N).

Then the supply function, built taking into account these factors, will have the following form:

The most important factor influencing the value of the offer - the price of the given product. The incomes of sellers and producers depend on the level of market prices, thus, the higher the price of a given product, the greater the supply, and vice versa.

Offer price is the minimum price at which sellers agree to supply the product to the market.

Assuming that all factors, except for the first one, remain unchanged:

we get a simplified sentence function:

where Q- the value of the supply of goods; R- the price of this product.

The relationship between supply and price is expressed in supply law, the essence of which is that the amount of supply, other things being equal, changes in direct proportion to price changes.

The direct reaction of supply to the price is explained by the fact that production quickly enough responds to any changes occurring in the market: when the price rises, commodity producers use reserve capacities or introduce new ones, which leads to an increase in supply. In addition, the upward trend in prices attracts other manufacturers to the industry, which further increases production and supply.

It should be noted that in short term an increase in supply does not always occur immediately after an increase in price. It all depends on the available production reserves (availability and workload of equipment, labor, etc.), since the expansion of capacities and the transfer of capital from other industries usually cannot be carried out in a short time. But in long term an increase in supply almost always follows an increase in price.

The graphical relationship between price and volume of supply is called the supply curve S.

The supply scale and supply curve of a good shows the relationship (other things being equal) between the market price and the amount of this good that producers want to produce and sell.

Example. Let's say we know how many tons of potatoes can be offered by sellers on the market per week at different prices.

Table 3.2. Potato offer

This table shows how many items will be offered at the minimum and maximum prices.

So, at a price of 5 rubles. for 1 kg of potatoes the minimum amount will be sold. At such a low price, sellers may be trading in a different commodity that is more profitable than potatoes. As the price rises, the supply of potatoes will also increase.

The supply curve is plotted according to the table. S, which shows how many goods producers would sell at different price levels R(fig. 3.2).

Rice. 3.2. Supply curve.

Changes in demand

The change in demand for a product occurs not only as a result of changes in prices for it, but also under the influence of other, so-called “non-price” factors. Let's take a closer look at these factors.

Production costs are primarily determined by prices for economic resources: raw materials, materials, means of production, labor force, - and technical progress. Obviously, the rise in resource prices has a large impact on production costs and output. For example, when in the 1970s. oil prices have risen sharply, this has led to an increase in energy prices for producers, an increase in their production costs and lowering their supply.

2. Production technology. This concept unites everything from genuine technical discoveries and better applications of existing technologies to the usual reorganization of the workflow. Improving technology allows you to produce more products with fewer resources. Technical progress also allows you to reduce the amount of resources required for the same release volume. For example, manufacturers today spend much less time on the production of one car than 10 years ago. Advances in technology allow car manufacturers to profit from producing more vehicles for the same price.

3. Taxes and subsidies. The effect of taxes and subsidies is manifested in different directions: increasing taxes leads to an increase in production costs, increasing the price of production and reducing its supply. Tax cuts have the opposite effect. Subsidies and subsidies allow to reduce production costs at the expense of the state, thereby contributing to an increase in supply.

4. Prices for related goods. Market supply is largely dependent on the availability of interchangeable and complementary products at affordable prices on the market. For example, the use of artificial, cheaper than natural, raw materials allows you to reduce production costs, thereby increasing the supply of goods.

5. Manufacturers' expectations. Expectations of changes in the price of a product in the future can also influence a manufacturer's willingness to bring a product to market. For example, if a manufacturer expects the prices of their products to rise, they can start increasing production capacity today in the hope of further profit and hold on to the product until prices increase. Information about the expected price reduction may lead to an increase in supply at the moment and a decrease in supply in the future.

6. The number of producers. An increase in the number of manufacturers of this product will lead to an increase in supply, and vice versa.

7. Special factors. For example, for certain types of products (skis, rollers, products Agriculture etc.) the weather has a great influence.

1. Demand is the intention of consumers, secured by means of payment, to purchase a given product. The amount of demand is the amount of goods that the buyer is willing and able to purchase at a given price in a given period of time. According to the law of demand, a decrease in price leads to an increase in the amount of demand, and vice versa.

2. Proposal is the willingness of producers (sellers) to supply to the market a certain amount of goods or services at a given price. The amount of supply is the maximum amount of goods and services that producers (sellers) are willing to sell at a certain price within a certain period of time. According to the law of supply, an increase in price leads to an increase in the amount of supply, and vice versa.

3. Changes in demand cause both price factors - in this case, there is a change in the value of demand, which is expressed by movement along the points of the demand curve (along the demand line), and non-price factors, which will lead to a change in the demand function itself. On the graph, this will be expressed by a shift in the demand curve to the right if demand is growing, and to the left if demand is falling.

4. A change in the price of this product affects the change in the value of the supply of this product. This can be graphically expressed by moving along the sentence line. Non-price factors affect the change in the entire supply function; this can be clearly represented as a shift in the supply curve to the right - with an increase in supply, and to the left - with a decrease.

Demand Is the amount of goods that buyers want and can purchase for a certain period of time at all possible prices for this product.

The so-called the law of demand, the essence of which can be expressed as follows: other things being equal, the value of demand for a product is the higher, the lower the price of this product, and vice versa, the higher the price, the lower the value of demand for the product. The operation of the law of demand is explained by the existence of the income effect and the substitution effect. The income effect is expressed in the fact that when the price of a product decreases, the consumer feels richer and wants to buy more of the product. The substitution effect consists in the fact that when the price of a product decreases, the consumer seeks to replace this cheaper product with others whose prices have not changed.

The concept of "demand" reflects not only the desire, but also the ability to purchase a product, ie, as a rule, it implies not just a need for a product, but an effective demand for this product. If there is a need for a product, but there is no opportunity to purchase the product, then there is no demand (effective demand) for this product. For example, a certain consumer has a desire to buy a car for 1 million rubles, but he does not have such an amount. In this case, we have a desire, but we do not have the opportunity to pay, so there is no demand for a car from this consumer.

The law of demand is limited in the following cases:

in case of rush demand caused by the expectation of buyers of price increases;
for some rare and expensive goods, the purchase of which remains a means of accumulation (gold, silver, precious stones, antiques, etc.);
when demand is switched to newer and better products (for example, when demand is switched from typewriters to home computers, lower prices for typewriters will not lead to an increase in demand for them).

The change in the quantity of goods that buyers want and can purchase, depending on the change in the price of this product, is called changes in the amount of demand. In fig. 4.1 graphically depicts the relationship between the price of a vacuum cleaner and the amount of demand for it. A change in the amount of demand is a movement along the demand curve.

Rice. 4.1.

D (eng. demand ) - demand; R (eng. price ) - price; Q (eng. Quantity ) - the amount of demand

If the price of a vacuum cleaner drops from 30 to 20 thousand rubles, then the value of demand for it will increase from 200 to 400 pcs. daily and vice versa.

However, price is not the only factor influencing the willingness and willingness of consumers to purchase a product. Changes caused by the influence of all factors other than price are called changes in demand. All these and other factors (the so-called non-price) act both in the direction of an increase and in the direction of a decrease in demand.

Non-price factors include changes:

in the income of the population. If the income of the population grows, then the buyers have a desire to purchase more goods, regardless of their prices. For example, there is a growing demand for high quality clothing and footwear, durable goods, real estate, etc .;
in the structure of the population. For example, an increase in fertility leads to an increase in the demand for baby products; the aging of the population entails an increase in the demand for medicines, items of care for the elderly;
prices for other goods. For example, an increase in prices for beef may lead to an increase in demand for a substitute product - poultry meat, etc .;
consumer tastes, fashion, habits, etc. and other factors not related to price;
in the expectations of buyers. So, if they expect that soon the price of the product will decrease, then at the moment they can reduce their demand.

In fig. 4.2 The influence of non-price factors on demand can be depicted as a shift in the demand curve to the right (growth in demand) or to the left (decline in demand).

Rice. 4.2.

D, D1, D2 - polls respectively initial, increased, decreased

What is an offer?

Offer - it is the quantity of goods that sellers want and can offer for a certain period of time at all possible prices for this product.

Supply law consists in the fact that, other things being equal, the quantity of goods offered by sellers is the higher, the higher the price of this product, and vice versa, the lower the price, the lower the value of its supply.

In fig. 4.3 graphically depicts the relationship between the price of a product and the amount that sellers are ready to offer for sale. Moving along the supply curve is called a change in supply. If the price of a vacuum cleaner rises from 20 to 30 thousand rubles, then the number of offered vacuum cleaners will increase from 200 to 400 pcs. daily and vice versa.

Rice. 4.3.

S (eng. supply ) - offer; R - price; Q - supply value

In addition to the supply price, non-price factors also affect, among which the following stand out:

changes in the costs of the firm. Reducing costs as a result of, for example, technical innovations or lower prices for raw materials and supplies leads to an increase in supply. Conversely, increases in costs resulting from higher raw material prices or additional taxes on producers cause a decrease in supply;
tax cuts for producers. Helps to stimulate the growth of supply, on the contrary, a decrease in subsidies from the state can lead to a decrease in supply;
increase (reduction ) the number of firms in the industry. Leads to an increase (decrease) in supply.

In fig. 4.4 the influence of non-price factors on supply is depicted as a shift of the supply curve to the right (supply growth) or to the left (supply decrease). In this case, they talk about a change in the proposal.

Rice. 4.4.

S, S1, S2 - supply respectively initial, increased, decreased

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