Identify a good you commonly use or would like to use. Explain at least three factors that would result in a shift in the demand curve for that good and three factors that would result in a shift in the supply curve for that good. Describe the effect on equilibrium price and quantity of each factor. Finally, explain how the shifts in demand and supply are different from movements along the demand curve or movements along the supply curve and why the distinction is important.
REPLY TO MY CLASSMATES RESPONSE TO THE ABOVE QUESTIONS AND EXPLAIN WHY YOU AGREE? (A MINIMUM OF 125 WORDS)
CLASSMATES POST
During this pandemic, other than gas and various grocery goods, my family and I are depending heavily on Netflix. Of course, we all know Netflix is a streaming service that allows its members to view episodes of television shows and popular movies and miniseries for a monthly fee. We currently use this service daily. It provides entertainment for our family in these uncertain times.
The demand curve involves the relationship between the price of a good or service and the quantity that is demanded over a time. Three factors that influence our use of Netflix include: inadequate programming of local television channels (our opinion), more control (no scheduled programming, ability to pause, rewind, and fast forward, and uninterrupted programming with no commercials), and lower pricing than satellite or cable. The supply curve involves the connection between the cost of a good or service and the amount supplied over a time. Three factors that influence the supply include: cost of internet service, cost of Netflix subscription, and competitor’s costs and services.
Equilibrium price is where supply matches demand of good and services. As the demand for the service and the supply of the service become equal, equilibrium is reached. With demand, consumers will buy less of a good or service at higher prices. At lower prices, buyers will demand more of a product. With supply, sellers will provide more of a good or service at higher prices.
A movement on the demand curve involves a change in the price and quantity demanded from one point to another. The relationship in demand remains uniform. A movement on the supply curve involves a steady supply relationship. A price change in the good or service has occurred as well as the quantity of the good supplied. However, a shift in supply or demand curve happens when a good or service’s demand quantity or supplied changes without a change in price.
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