Economics for Business Essay Example | Topics and Well Written Essays - 1500 words - 1

Economics for Business - Essay ExampleNon economists believe in the conception of giffen goods which have an up-ward sloping turn out, Veblen goods are the ones whose crave decreases with decrease in the prices and the inferior goods demand decreases with increase in income. Depending on where the VM products lie, this will determine the believably severance on demand. Loyal consumers of VM products will have the services delivered on demand.Demand is the economic want backed up by purchasing power, demand curve represents the amount of a good that buyers are willing to purchase at various prices assuming all other non price factors remain constant i.e. at ceteris paribus. In a free market, quantity demanded and quantity supplied depends on the market price. In our case the decrease in demand is likely because shifts in the demand curve towards the left.1 In our case of VM the demand of the services will be affected by the non price factor. For the consumers to continue demandin g its services, they have to improve their terms with them. As the VM claims that the SkyB is coerce with its customers, meaning that they are competing firms and therefore its a substitute for the VM consumers.To mitigate these consequences of the likely decrease in demand, it puke lower the prices for the customers who demand for their services and this is likely to increase its demand against that of its competitors if there is free market a d therefore has a bigger market share. It can also improve the feeling of its services that it delivers to its customers this is because the demand of a normal good is likely to increase with its increase in its quality. VM can also promote isits products through public awareness, this can be done through advertising, sales promotion, offering free services at certain time, and it can also use road shows. 2 hesitation twoMarket is a group of buyers and sellers exchanging goods that are likely substitutable for one another. Markets are defin ed by the demand conditions that exist they embody the geographical zone of consumers choice for the goods or services. Markets exists in two dimensions-a. Product typeb. Geographical areaMarket structure refers to the selected number of organizational characteristic of the market that establishes the relationship between buyers and sellers of a certain product market structure analysis is therefore the study of organizational features of market that is believed to have significance for conduct conduct and performance of firms comprising the market. In simple theoretical analysis, the concept of market was traditionally defined as consisting of buyers and sellers of a self-colored good who have insufficiently finis contact with each other that o single price prevailsThe major market structures arePerfect competition This is where the market has very many firms producing homogenous product.Monopolistic competition This is also called competitive market, this is where there are ver y many firms and each commands a small share of the market share. Oligopoly This is where the market is rule by many small firms which own more than 40% 0f the market share.Oligopsony This is where the market is dominated by a few buyers with many sellersMonopoly This is where there is exclusively one provider of a certain product.Natural monopoly This is a monopoly in which economies of scale cause efficiency to increase as the firm