Question

How can a pandemic like coronavirus affect the consumer's or investment decision? Which part of the economy will be affected and which one will not be affected? Explain

Answer 1

Pandemic like coronavirus can affect the consumer's decision to a large extent. It has made the people realized that they can spend their life comfortably with minimal amount of resources and the demand for luxuries has come to minimal. They have understood very well that the most important requirement of their life is only food which is essential item and rest all luxuries can be kept aside. The investment in real estate, luxurious cars, gold have also come down to minimal point. As a result, people have realized to invest only in healthcare and for their physical fitness and have stopped thinking about their personal luxury.

Service and manufacturing sectors of the economy will get affected much as the demand of the people come down drastically. Moreover, due to shortage of the supply of raw materials, many firms have to shut down the production forcibly. Maruti, an automobile company has clearly stated that there was not a single car sold by Maruti in the previous month. Many companies are on the verge of shut down.

Primary sector like agriculture, fishery, poultry, dairy remain unaffected due to coronavirus. This is because during lockdown people are not into wasteful expenditure and have realized very well that food is a basic essential item. So the primary sector like agriculture remains unaffected as people would be purchasing only the essential food items till the time the country comes out of pandemic effect.