Analysis of the Impact of Changes in Demand and Supply on a Selected Business

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A demand curve shows the relationship between the price and quantity of a product that consumers are willing to buy. In business, demand curves are useful when testing and measuring the supply and demand of certain products within a competitive market. Graphed over time, demand curves assist businesses in determining if a certain product is actually profitable at the pricing point on the curve where it is in demand. Price Quantity There are many things that influence demand of product. In Chester Zoo’s case, this could be the economic environment, as Chester Zoo are dependent on their customers and the customer generally do not have a lot of money to be able to afford the tickets to get into the zoo as well as pay for the important things they have to pay for, then the zoos money that they earn will fall because lower amounts of people are coming to the zoo. For example, if Chester Zoo offered tickets for half price more people would come as there is more chance of the customers being able to afford them, so the demand would be high. But if Chester Zoo put the ticket prices up then even less customers would come to the zoo because they would probably not be able to afford to pay for the tickets if they could not afford the original price, so therefore the demand would be low. Also if Chester Zoo where to offer a bundle, for example a family package tickets, then there would be more customers so there would be higher demand for the ticket bundle. Shifts in the demand curve While a change in price will cause a movement along the demand curve, some factors actually cause the entire curve to shift. A shift in the demand curve itself is typically related to a change in consumer income, the pricing of substitute products or consumer preference. If these factors result in less demand for a product, the curve will shift to the left, resulting in a decrease

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