A. What causes the changes in supply and demand in the simulation?
b. How do shifts in supply and demand affect your decision making?
c. List four key points from that were emphasized in the simulation.
d. How can you apply what you learned about the concepts of supply and demand from the simulation to your workplace?
e. Determine how price elasticity of demand affects the decision making of the consumer and of the organization.
f. Summarize the results of the assessment.
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Below are my answers.
Causes of the Changes in Supply and Demand in the Simulation
The demand on the different products and services in the simulation was affected by the price of these goods. Since price is a key factor in determining the demand for the goods in question, then the purchasing power of the consumer also causes changes in the demand. Furthermore, the purchasing power of a consumer is directly affected by the per capita income and the gross domestic product.
On the other hand, the supply for the goods is affected by the price demanded and the prices of the different factors of production. The lower the price demanded compared to the total price of the factors of production, or the production cost, the lower the quantity of the products producers might be willing to supply.
Given that several factors can cause shifts and changes in the quantity supplied and demanded for a particular goods, decision makers need to pay attention to these factors and how they impact supply and demand.
Impact of Shifts in Supply and Demand on Decision Making
In strategic and tactical planning, companies through their key people and decision makers usually use either of two methods: top-down and down-up approaches. In a top-down approach, a company studies its macroeconomic environment and assesses how this environment will change in the future and how these changes can affect their operations. On the other hand, in the down-up approach companies assess its operations and production capacity and then project ...
Causes of the Changes in Supply and Demand in the Simulation are noted.