Purchase Solution

Discuss: The Market for Consumer Goods and Services

Not what you're looking for?

Ask Custom Question

Question: In the market for most consumer goods and services we assume the law of supply and demand, operating through open competition, determines the price. Competition, however, does not necessarily work to the consumer's advantage in the insurance market. Please discuss the following questions:
- How does the pricing of an insurance policy for the insurer differ from a bologna manufacture's pricing its product?
- Why does the difference in pricing problems require that insurance pricing be subject to regulation?
- Why might be lowest-priced insurance policy be undesirable from the consumer's standpoint?

Purchase this Solution

Solution Summary

This response discusses in 280 words, the consumer market for good and services, analyzing topics which include pricing for insurance, regulation and the lowest-priced insurance policy.

Solution Preview

In the case of comparing insurance to a food product, there are several points to take into consideration. The food product is highly elastic whereas insurance is mostly inelastic, for most types of insurance. Consumers must have car insurance by law in almost all states, and they must also have business insurance and homeowners' or renters' insurance policies. This makes insurance a relatively inelastic good. Because it is inelastic, ...

Purchase this Solution

Free BrainMass Quizzes
Basics of corporate finance

These questions will test you on your knowledge of finance.

Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.


This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

Cost Concepts: Analyzing Costs in Managerial Accounting

This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.