Supply and Demand of Tylenol

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Tylenol is a widely renown drug used for headaches, fever, and pains. The product’s active ingredient is Acetaminophen, which is not patented and thus is used in many other medications. Tylenol is considered a normal good. People would much rather prefer the brand name that is more commonly seen, rather than the CVS-brand Acetaminophen which is essentially the same. However, income is the main factor that will decide the average consumer’s decision. If a new study was revealed (hypothetically, of course) that there are severe adverse effects from the consumption of Acetaminophen in general, substitute goods would gain an advantage in the market. Ibuprofen and Aspirin treat nearly all the same symptoms that Tylenol does, and as a result can be considered substitute goods. Another shift along the demand curve is the general taste of the consumer. There are many factors that affect this. Pharmaceutical knowledge, experiences, and influence by advertisements are just a few. Perhaps a group of consumers prefer Ibuprofen, regardless of its nearly identical results. This would cause a shift that will decrease the demand of of Tylenol. Expected future prices can also affect the demand curve. If it is suspected that Tylenol will be more expensive next month, it would cause in shift that increases the demand of Tylenol. Since people are rational, they know that buying more now will save them money later. The supply side of the market also has various factors which cause a change in supply. The prices of inputs is an imperative example. Tylenol is a synthetic drug, meaning that it cannot be found in nature. Since it must be made in a lab, there are other substances which must undergo reactions to create Tylenol. If the price of these precursor substances were to go down, there would be an increase in supply. Similarly, a decrease in supply would be a result of the

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