Tag Archives: Supply and Demand

KEVIN LEE SUPPLY AND DEMAND REDO

http://www.scmp.com/business/companies/article/2068964/global-dairy-prices-tight-supply-strong-chinese-demand

Market: Smartphones

The demand for the new iPhone 7 plus has skyrocketed globally in response to its revealment on September 7th, 2016 as well as their one-week pre-order period. The demand for the new iPhone has shifted right due to two determinants: Buyer’s Preferences, and the Number of Buyers.

The consumer’s taste has changed due to the failure of Samsung’s Note 7, which had to be re-called back since their lithium ion batteries combusted when heated/charged for too long. Due to this safety hazard, buyers began to prefer the iPhone 7 plus since it did not combust into flames while it was charging (Or at all).

Also, the demand curve shifted right due to an increase in the number of buyers. Every year, millions of people line up early to get their hands on a new iPhone as soon as possible. However, this year the number of buyers have increased so much that Apple is having trouble supplying enough phones for this amount of demand. This may decrease their profit/demand in the long run and has already resulted in a shortage of iPhones. However, at the moment the demand is very high.

As a result, the demand curve shifts right. This increases the price and quantity as seen in the graph below.

Housing Market SupplyDemand Graph

Advertisements