Topic: Supply and Demand
Introduction to Business
October 14. 2012
Supply and Demand
There are several factors, which affect the demand and supply of goods and services, in any given market. Changes in these factors usually shift the demand and supply curves accordingly. A fast food company operating in a given location essentially depends on supplies of fresh farm produce. Consequently, they use the supplies to prepare food which they serve to customers in their food retail outlets.
The supply of food products from the fast food outlets can be affected by a number of factors. Some of these factors include:
a) Changes in weather conditions: Drastic changes in the weather pattern would significantly affect the supply of food products in the ...view middle of the document...
Therefore, the change is taste and preference for fast food products among consumers would significantly affect the quantity demanded. This will consequently affect the supply of fast food products by the fast food outlets.
c) Changes in the number of fast foods outlets operating in the same location: Most of the fast foods outlets usually supply almost similar food products to consumers. Hence, an increase or a decrease in the number of fast food outlets operating in the same location would affect the quantity supplied by a given fast food outlet accordingly. For instance, an increase in the number of fast food outlets operating in the same location would lead to the decrease in quantity supplied of food products in the given fast food outlet.
On the other hand, the demand for food products from the fast food outlet can be affected by several factors. Some of these factors include:
a) Changes in the prices of fast food products: Significant changes in the prices of the food products supplied by fast food outlets affect the demand of such food products. Increase in the prices of such food products may consequently lead to a decrease in the quantity demanded. However, decrease in the prices of the food products would lead to an increase in demand the food product.
b) Scientific discoveries (Medical): Discoveries made by researchers on the effect on health of certain fast foods from fast food outlets could significantly affect the demand of certain food products from the fast food outlets. Various health experts may advice and recommend that people should avoid consuming certain products from fast foods outlets. Consequently, this may lead to a significant decrease in the demand of such products from the fast food outlets.
SUPPLY AND DEMAND