Economics - Supply and Demand Model

Supply and demand is a model for understanding how prices and quantities determined in a market system. Economics- is the study of how human beings coordinate their wants and desires, given the decision-making mechanisms, social customs, and political realities of the society (McGraw Hill, 2011). Microeconomics- is the study of individual choice and how that choice is influenced by economic forces. In studying microeconomics you study a wider range of services, productions, exchanges. While not as discriminate as macroeconomics, you can get a broader picture and grasp the basic concepts of an economy. Law of supply- states that when the price of a good rises, and everything else remains the same, the quantity of the good supplied will also rise. Law of demand- states that when the price of a good rises, and everything else remains the same, the quantity of the good demanded will fall.

Increase income causes a change in demand. Another would be the limit of the supply of product or service while the number of people vying for the ability to use the product or service has increased or decreased substantially. Bottom line, when a limited supply cannot meet the demand of those seeking the product or service the price increases until demand begins to subside. The reverse could also be true - that whichever substitute products or services interrupt the demand and lessen its value due to a glut or overabundance compared to the number of buyers. For example, some time ago there was a problem with the tomatoes used and distributed here in Florida, as a result, tomatoes was limited so everyone saw an increase in the price at the stores, but as the problem stabilized the product price returned to normal. Another example, I recently, went to the store and bought some limes usually the limes are ten for a dollar but because of the cold weather the supply decreased thus, finding the same price for five limes.

In this article, t he growing prosperity of several Pacific Rim countries--Hong Kong, Japan, Singapore and Taiwan--has led to diversification and internationalization of diets. The result is the purchase of more convenience and high-value processed foods and more meals being eaten away from home.

The major factors that have led to changing food consumption patterns include:

--increases in per capita incomes

--demand for high-value foods

--Westernization of diets

--more women in the work force

--more people eating out

--health consciousness

--concern for product freshness

--decrease in household size

--consumption of traditional foods

The average household size is shrinking