Aggregate demand

Figure 1.5: value propositions Source: Kotler & Armstrong (2010, 238-240) MORE-FOR-MORE The first possible value proposition is the more-for-more proposition. A brand that opts to use this proposition will be capable to justify an upper price by providing clients with a top level of reimbursements in their product. MORE-FOR-THE-SAME The subsequent proposition is the more-for-the-same option, that provides a buyer more benefits while charges them the equivalent price. The more-for-the-same…

A retail market is nothing but a part of systems, procedures, institutions, social relations and infrastructures where retail business organizations get involved in exchange. Even though companies may follow the barter route for exchange goods and services, the markets follow the literal form wherein sellers offer their goods and/or services including labour in to buyers in exchange for money. It can be said that a retail market is the ecosystem which determines and establishes the prices of…

2.4 Luxury and Sustainability 
On the bases of financial value of a luxury product, consumers are ready to pay a premium price of the goods. These goods are not normal goods as it holds qualities of being luxury with its quality level, scarcity and aspiration. As stated above, luxury deals with scarcity and scarcity is related to something which is on the verge of extension or of a very limited supply. Therefore we can say that if a luxury product is encouraged for a more reasonable price, this…

order to study the relationship between the price and demand of a product I had to calculate the “price elasticity of demand”. I also studied the relationship between the revenue and marginal revenue of a product to form a more in-depth answer to my question. Relationship between Supply and Demand My first step in studying the relationship between the price and demand of an object was to do some research on the basics of economics. The law of demand states that as the price of a product…

export to other counties where the United States would benefit because of higher prices. Therefore, the two counties participating in the tradeoff result with a net gain. Roles reversed, say the U.S has a higher demand for a certain product they could import the good to meet domestic demand cheaper. Based on the opportunity cost and comparative advantage concept, all countries participating in international trade are highly benefited. As well as participating in international trade would…

those who skipped college and do not have that high paying job that is so sought after. The topic of supply and demand can be applied to most everything when money comes into the equation. When the supply is low or deficient, and demand increases, then the amount of money paid will also increase. On the contrary, if there is a surplus in the supply of an object, the lower the demand and the lower the price. This applies to college in two ways. The first being that college being seen as a…

Public transportation is a system of transportation that the government offer for people who cannot use private transportation. Previously, the primary objective behind public transportation was to give low-income people a method of transportation with sensible costs. Nevertheless, nowadays some private companies changed this principle by using public transportation as a business deal. Numerous individuals believe that public transportation is essential for them and it makes their lives easier,…

Summary of “Economic Profit vs. Accounting Profit” Robert L. Bartley writes about the about how the economic and accounting versions of profit differ. While economists are interested in what creates production and thus profit, while accountants focus on the money earned for the owner. Most CEO and CFOs are follow the accountants definition, however they should be looking at the economists way, as it show the driving force behind the company’s production rate and profit. Summary of “America’s…

Three Ideologies of Political Economy and beyond By Bernardo Creamer The ‘Prezi’ presentation “Copy of Three Ideologies of Political Economy”, used in class, is based on the ideas contained in the book by R Gilpin about political economics. Gilpin states that there are three ideologies that differ over a wide variation of questions such as: - What is the importance of the market for economic growth and distribution of wealth among groups and societies? - What should be the role of markets in…

In his pioneer model for dividend smoothing, Lintner (1956) proposed that firms in general have a long-run target payout ratio. The role of the managers is to gradually adjust firm payment of dividends toward the target. However, in this model adjustments are partial because they are not free and the firm has to incur a cost for the adjustment. The Lintner model for partial adjustment is given by: Dit – Dit-1 = ai + ci (D*it – Dit-1) + εit (1) where Dt and Dt-1 are dividend payments at…