Market equilibrium process is defined as the matching process of supply and demand of the consumers. The law of demand is simply the pricing of items as it relates to the demand of item. McConnell, Brue, & Flynn (2009), “states that consumers preferences along with marketing of goods; expectation of consumers; level of income from consumers purchasing products; and cost of goods determines how the level of demand will be affected” (Chapter 3).
Consumers are drawn to items for many reasons (i.e., looks, style, and latest design) however; the items may or may not be readily available. For instance, during the holidays many consumers searched for the latest and greatest game devices and other electronic devices. But what we have discovered is that during that specific time of year, the demand for such items are extremely high and he supply of demand seems to fall short.
When an individual is seeking a specific item that cannot be found in stores, the internet is the next big source to finding what cannot be kept on shelves in stores. In most cases the prices online may be higher because of shipping but consumers find that it is a price they are willing to pay for peace of mind and to have the product of demand at the time. When a consumers desire to purchase a product that is not readily available it is considered a determinant in demand. For instance, individuals seeking to purchase the popular “Xbox Kinect System” during the holidays found that stores had a limited supply of the gaming device. However, because of the large volume of consumers seeking the good, the organization could increase the price, which would cause for an increase in profit.
When the company...