Question

What is damand and supply curve in the retail industry especially with RM williams brand?

Answer 1

Demand refers to the amount of some good or service consumers are willing and able to purchase at each price. Demand is based on needs and wants—a consumer may be able to differentiate between a need and a want, but from an economist’s perspective they are the same thing. Demand is also based on ability to pay. If you cannot pay for it, you have no effective demand. What a buyer pays for a unit of the specific good or service is called price. The total number of units purchased at that price is called the quantity demanded.

A demand curve shows the relationship between price and quantity demanded on a graph like shown in Figure, with quantity on the horizontal axis and the price on the vertical axis. A demand curve slopes downward towards right, this is because with a decrease in price of any good its quantity demanded increases, this is called the Law of Demand.

Supply mean the amount of some good or service a producer is willing to supply at each price. Price is what the producer receives for selling one unit of a good or service. A rise in price almost always leads to an increase in the quantity supplied of that good or service, while a fall in price will decrease the quantity supplied.

A supply curve shows the relationship between price and quantity supplied of any commodity. As the price of a commodity increases, its quantity supplied also increases. So a supply curve slops upward towards right.

If we talk about the retail industry, specially RM Williams brand, the demand curve is the curve which represents the amount of goods of the RM Williams brand which the consumers are willing to purchase at different prices. And the supply curve will represent the amount of different goods the RM Williams brand want to sell at different prices. The demand and supply curves are shown below.

This is the supply and demand curve of the RM Williams brand. The industry supply and demand curve can be generated by the horizontal summation of the individual firm's demand and supply curves in the industry.