Supply and Demand

Ronald Reed

Supply and demand Paper

XECO/212

6/2/2012

Taking my mother’s advice on buying a new car, her advice being that I should work throughout high school to save as much money for a good new car, I decided that it was what I was going to do. So I did what she done when she was younger, worked hard after school which left little time for fun. My first job what in car parts, where I worked in an auto repair shop were the business specialized in automobile parts and repairing cars. I worked inventory and customer service, so I do have some 4 years or so worth of knowledge of supply and demand. When we work for a supply and demand business we have to meet all of the trends that are set by the product demands. In this Paper I will discuss the causes of supply and demand, substitutes and complements on the products and the impact it causes on price elasticity.

First off we know that one factor that can decide the change in the supply and demand is the economy. Because so many people are out of work, it causes people to spend less because they don’t have the luxury of spending money on parts for cars. This causes the company to cut back on its work force and forces the company to cut some of its workers salaries. When the economy worsens so does the sales of car parts, because cars are a luxury item it causes less people to buy the car parts if they need it, because they will have to worry about how they will pay the bills or put food on their tables for their families. When this happens it causes the company to have many parts in their inventory, this makes the story or company put discounts on their products. When more people buys them the story gets low on the product, which then makes the store mark up the products and so if the customer needs that part or product they will buy it if they need it that bad. This always helps the store make up for any losses in sales it has. Another case is the Stores competitors, for example; in my...