Question

1. In a Word document, write a one-page essay in which you answer the following question. Distinguish the four factors that shift supply and demand. Provide a real-world example of each. Dantbette

Answer 1

There are many factors that affect demand and supply, the very basic factors that affect them are pricing. The higher the price the higher the supply and the same way lower the demand (according to the law of demand). The second factor that affects the demand and supply is income and credit availability that can change the demand and supply, the higher the income that much higher the demand is and as the credit is highly or easily available the supply is higher.

Related goods which consists of supplementary and complimentary goods is a very important factor that a shifts the demand and supply. The prices of complimentary good works as the price of that same good and the price of supplementary goods is in competition of the given good.

Some other factors that affect the demand and supply are taste, season, commercial advertising, which are generally known as the indirect factors that affect the demand and supply of any commodity