Swot Analysis: Strengths, Internal Execution, Weaknesses
Swot Analysisstrengths Internalexecutionweaknesses Internalexecut
Swot Analysisstrengths Internalexecutionweaknesses Internalexecut
SWOT Analysis Strengths (Internal/Execution) Weaknesses (Internal/Execution) Opportunities (External/Environment) Threats (External/Environment) Assignment Details Price elasticity of demand measures consumers’ responsiveness to changes in the price of a good. There are a number of variables that affect consumers’ decisions, among them the following: · The availability of substitutes · The specific nature of the good · The part of income spent on the good · The time consumers have to buy the good Please draw on your experiences as a consumer and your Unit 2 readings to address the following 4 topics. Make sure you use economic concepts in your main contribution. 1. Choose a product that you have purchased in the past 1–3 months from a clothing or shoe store. 2. Describe how each of the 4 factors listed above contributed to the elasticity of the good. 3. Is the product considered elastic, inelastic, or unitary elastic? 4. What effect does the current supply and current demand have on this product?
Paper For Above instruction
Understanding the price elasticity of demand is crucial in analyzing consumer behavior and market responses to price changes. In this paper, I evaluate a recent purchase of a pair of running shoes from a local athletic footwear store, examining how the four key factors influence its price elasticity. I also analyze whether the demand for this product is elastic, inelastic, or unitary elastic, and discuss the current supply and demand dynamics affecting the product.
Choice of Product
Recently, I purchased a pair of running shoes from a popular brand, which I used primarily for fitness activities. The purchase was made within the last three months, reflecting a typical consumer decision influenced by various market factors and personal needs.
Influence of the Four Factors on Price Elasticity
Availability of Substitutes
The availability of substitutes significantly impacts the price elasticity of the running shoes. Numerous brands and models exist, ranging from budget to high-end options. Since several comparable alternatives are readily accessible, consumers can easily switch if the price increases substantially. This high availability of substitutes makes the demand for such shoes relatively elastic, as consumers are sensitive to price changes and can shift their preferences to other brands or styles.
The Specific Nature of the Good
The nature of the good—athletic footwear designed for running—affects its elasticity. While some consumers may prioritize brand or specific features, many see running shoes as functional and interchangeable. If the shoes have unique features like superior cushioning or brand prestige, demand may become slightly inelastic; otherwise, they're viewed as commodities, increasing elasticity.
The Part of Income Spent on the Good
Running shoes generally constitute a moderate to significant part of a consumer's budget for athletic gear but are still not a primary expenditure like rent or essentials. Given their relative expense, consumers may be more sensitive to price changes, especially if purchasing more than one pair or replacing existing footwear. As a result, the demand can lean towards being elastic, particularly among budget-conscious consumers or for non-essential purchases.
The Time Consumers Have to Buy the Good
Time also plays a pivotal role. Immediate purchases, driven by urgent needs like running out of shoes due to wear, tend to be less elastic because of necessity. Conversely, when consumers have more time to consider prices—such as during sales or seasonal discounts—they are more responsive, making demand more elastic during these periods.
Elasticity Assessment
Considering the above factors, the demand for these running shoes is generally elastic. The availability of substitutes, moderate expenditure share, and flexible time horizon all contribute to consumers’ sensitivity to price changes. If prices rise significantly, many consumers are likely to delay purchase, seek alternatives, or opt for cheaper brands.
Current Supply and Demand Dynamics
The current market situation shows a relatively high supply of athletic footwear, with brands competing fiercely during sales seasons. Demand is consistent but fluctuates with promotional activities. Supply chain disruptions or an oversaturation of the market could exert downward pressure on prices, further emphasizing the elastic nature of demand. Conversely, if demand exceeds supply during peak seasons, prices might temporarily increase, but overall, the market tends to balance through competitive pricing and promotional discounts.
Conclusion
The purchase of running shoes exemplifies how multiple economic factors influence demand elasticity. The high availability of substitutes and the moderate share of income spent on such goods render demand generally elastic. Supply and demand conditions continue to shape pricing strategies and consumer responsiveness, illustrating the complex interplay between market forces and individual purchasing decisions.
References
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