Question

Discussion Market system in microeconomics. What did you find interesting about the topic? Why?

At least 300 word please

Answer 1

A market system is a network of buyers, sellers and other actors who come together to trade in a specific product or service. Market participants include: direct market players such as producers, buyers and consumers who drive market economic activity Suppliers of goods and services such as finance, equipment and business consulting Entities that influence the business environment such as regulatory agencies, infrastructure providers and business associations A market system may be product-specific (coffee, mangoes, dairy) or cross-cutting (finance, labor, resources for business development). The strength of a market system depends on how well participants are getting funding, starting businesses, and adopting new technologies and best practices.

In fact, the market economy is an economy that allows free trade in goods and services on an open market. A market economy provides the business and customer with a win - win scenario. The U.S. is an example of a country using a system of market economy. Starting up is easy for businesses, creating constant competition for other businesses. It allows customers to have choices and keeps business owners on their toes.

Increased supply and decreased demand: this scenario is leading to a fall in prices. Imagine standing in a soccer game with a concession. The staff made a lot of popcorn during half-time to keep up with the demand. We were able to sell the popcorn at the full price at this time, a dollar a pack. As the game ends, the staff know that they still have popcorn, people leave, and it's better to lower the price than to throw it away. So they lower the price to a bag of 50 cents. When time goes on, the employees may need to lower the price to break even more than to lose money on the item. In the beginning, there are few of them and the company wants to test the waters. The company can charge this price by promoting the features and creating hype about the product. This makes customers feel like they're going to have to run out and get the item as few are available. It is the result of scarcity.