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Economics
Human beings are an ever changing species when it comes to what they desire and how they attempt to acquire those desires. Economics is the study of how human beings coordinate their wants and desires, given the decision-making mechanisms, social customs, and political realities of the society (Colander, 2010 pg. 4). This is a broad study that encompasses entire cultures. Businesses are burdened to answer three basic questions when they decide to enter into the markets. The first question is what to produce and how much of it to produce. The second is how to produce the product. Finally, for whom should the product be produced? These are fundamental questions that establish the foundation of the product market.
To further narrow the down the study to individual preferences the term microeconomics is used. Microeconomics is defined as the study of individual choice, and how that choice is influenced by economic forces (Colander, 2010 pg. 15). The reason microeconomics is studied is companies can determine how individuals desire to make purchases. By studying individual’s spending habits allows businesses to determine what products the consumers are wanting. Companies do not want to produce goods that have little to no market value.
The basic economic structure includes two elemental laws. The law of supply and the law of demand. Without these two elements economics would have no meaning. The law of demand states that the quantity of a good demanded is inversely related to the good’s price (Colander, 2010 pg. 84). In other words as the demand for the product rises the price falls. In opposition, as the demand for the product falls then the price rises. This theory work in favor of the consumer more so than for the manufacturer. The marketabilty of the product is directly related to consumer demand.
The law of supply works in...

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