Rus Articles Journal

Why the businessman needs to consider the law of supply and demand?

Demand are generated by the offer and vice versa. Postulate perfectly known for all. Only if to dig more deeply, then it turns out that, unfortunately, not everyone adheres to it.

The market relations (not only in our country, but also out of it) are often constructed rather on personal interests and unreasonable decisions, as affects the average consumer negatively. But, before passing to the arguments, I would like to remind, this mechanism how exactly has to work.

Consumers buy more goods when the price falls, and less when it grows. Producers, on the contrary, deliver more goods when the price of it grows, and less - when it falls. As a result both buyers, and sellers so react to incentive - market price that their actions balance supply and demand.

If buyers wish to get goods more, than sellers intend to provide, the price of it inevitably grows. Higher price reduces consumption and stimulates production, thereby, counterbalancing supply and demand.

And, on the contrary, if consumers do not wish to buy the available quantity of goods, the stocks accumulating at producers put pressure upon its price. In turn, lower price stimulates consumption and slows down production of goods until demand is not counterbalanced with the offer. That is the price directly depends on supply and demand and vice versa. And if it is regulated by these factors, then, as a result, all are happy (conditionally, of course).

This law is confirmed also by the fact that it works and in other spheres, besides economy per se. Well, for example, policy. For the voter (but for any person) priority is that candidate who promises more changes to the best. In turn, candidates for any posts in the government begin to compete in number of promises (the truth, therein, do not forget and to put footboards to competitors, but it is already, as they say, other history).

What occurs at us. Motivation of any businessman - receiving the maximum profit. But many business owners try to receive that, doing more margin on prime cost of goods, than would cost. Though the elementary calculations would show that at the smaller prices and (here and our basic law works), as a result, large volumes of sales, the profit not only will increase, but also there will be an opportunity to quicker expand the range. What, in turn, will lead to a bigger turn.

Often such actions are result of insufficient knowledge and over time businessmen understand the mistake. And in this case it is possible to tell one - to make the decision to become the businessman it is necessary not only proceeding from financial opportunities. It is work, first of all, on itself. And if you are not able or do not want to be engaged in self-education, then use that the state cares for you. In any jobcenter it is possible to complete a course of the young businessman and believe - it will not be superfluous.

As an example the second motive of independent overestimate of the prices it is possible to cite a rise in price of many products in the winter. It is, in particular, about agriculture products. Not the problem of complexity of delivery or lack of enough a product was motive of overestimate of the prices, for example, for potatoes, last winter. In many cases businessmen motivated it with need of purchase of the equipment for heating of these products.

A consequence - the person buys instead of five kilograms of potatoes, one (as, unfortunately, our salaries do not grow as quickly, as the prices). Both the consumer, and the seller suffers in this case. The first lacks neither money, nor a product, and at the second anyway the profit falls. And here we besides come back to, it seems as, truth known for all - if the price fell, then would buy more. And potatoes, perhaps, did not manage to vanish in such quantities.

In these examples of a problem on the way businessmen create. Breaking the actions normal price control in the market, they worsen both the affairs, and wellbeing of the consumer, and economic system of the country in general. There is a lot of similar cases in small and medium business and all of them are similar. Also methods of their decision are similar - improve yourself and the knowledge as it was already told, and, most likely, everything will be adjusted.

In conclusion it would be desirable to tell that ourselves form the economy and therefore have to work consciously, and it is, whenever possible, correct. And though personal benefit was always and will motive of any businessman that is quite normal, making some acts, it is just necessary to realize their impact both on himself, and on others. And the reasonable businessman will be able to avoid reefs of our economy what it is sincere all and I wish.