5- Supply & Demand

You may wonder why the prices of goods go up and down so often. One of the reasons is the law of supply and demand.

Supply refers to how many of a certain goods or services are available for people to purchase. Demand means how many people wish to buy that good or service.

How does this work? Let’s say that a brand-new super powerful video game is about to come out. The game makers must decide how many of the games to make so they are not stuck with too many.

They then have to decide how much to charge for the game – its price. They would need to charge enough for the game to cover the costs of creating the game, advertising the game, shipping the game to stores. Since they want to make a profit on the game, they will also want to figure that cost as well. If the price of the game is too high, however, people may not be able to afford it or decide it’s not worth that price and there will be too many or an oversupply. If the price is too low, costs will not be covered and little profit will be made even though the game may sell very well. The company would lose money and may even have to close. The people who invest money in the company would not want to give the company anymore to make more products because they would not get a good share of the profits. Usually as prices rise, the supply or amount of a product increases, and as prices fall, the supply decreases as more people can afford the product. If the product is truly excellent one, there will probably be a high demand. Also if it is well advertised, more people will know about the product and be 

apt to want it. If the product is not well advertised or is not a good product, people will not want it and the demand will be low and the supply greater.

In the case of video game, if a better game came on the market later with superior technology, the demand for the current game would probably drop and thus the price would have to drop to sell it

Other factors that affect sales of an item are if the product is available, how good the customer service is, the appearance of the store, how the items are displayed – even what the parking is like for a store or the colors of the boxes the product is in.

Quiz 1 (How to agree)

•       Q1 You can be absolutely sure I'm on your ........

(a) road (b) corner (c) route (d) side

•       Q2 You can ....... on me for your support.

(a) show (b) rely (c) try (d) test

•       Q3 Our views clearly ....... at this point I'm pleased to say.

(a) convert (b) concert (c) conduct (d) coincide

•       Q4 Fortunately the leader and all her members were singing from the same ....... sheet.

(a) hymn (b) prayer (c) lyric (d) sermon

•       Q5 It's good that we both have the same way of ....... at things.

(a) seeing (b) peeping (c) looking (d) viewing

•       Q6 I'm pleased to say that we speak on this matter with one ........

(a) sound (b) tone (c) harmony (d) voice

•       Q7 I certainly won't ....... any objection when you make your proposal.

(a) rise (b) raise (c) lift (d) arise

•       Q8 I'm ....... you all the way as far as that's concerned.

(a) with (b) by (c) at (d) across

•       Q9 I'm happy to ....... those sentiments and wish you every success.

(a) encompass (b) enthuse (c) endorse (d) endure

•       Q10 When it comes to the vote I'm willing to put my ....... up and support you.

(a) head (b) chin (c) arm (d) hand

Quiz 2 (Business Expressions 2)

•       Q1 I've warned you before that you shouldn't get involved in this matter and you have ....... business discussing it.

(a) some (b) little (c) no (d) not

•       Q2 That's really not my concern at all and I'm certainly not ....... the business of telling others what to do.

(a) in (b) out (c) of (d) by

•       Q3 She was very enthusiastic about her new job and was making rapid progress ....... nobody's business.

(a) as (b) with (c) similar (d) like

•       Q4 I really wouldn't joke about it because these people are deadly serious and ....... business.

(a) signify (b) mean (c) require (d) need

•       Q5 He didn't hesitate to tell me that I wasn't wanted and just told me to ....... my own business.

(a) concern (b) look after (c) tend to (d) mind

•       Q6 I'm afraid it won't be possible to talk to the boss today because he's away ....... business till Tuesday.

(a) off (b) on (c) for (d) to

•       Q7 He was very keen that we kept in touch and for that reason he handed me his business ........

(a) ticket (b) paper (c) card (d) notice

•       Q8 This is the really important part of the machine and that's why we call it the business ........

(a) centre (b) end (c) area (d) point

•       Q9 The whole site has nothing but offices and administration centers and that's why we call it a business ........

(a) place (b) situation (c) field (d) park

•       Q10 All the famous film stars, actors, directors and writers were at the festival representing the world of ....... business.

(a) play (b) drama (c) show (d) performance

Answers:

A1 (d) side

A2 (b) rely

A3 (d) coincide

A4 (a) hymn

A5 (c) looking

A6 (d) voice

A7 (b) raise

A8 (a) with

A9 (c) endorse

A10 (d) hand

 

A1 (c) no

A2 (a) in

A3 (d) like

A4 (b) mean

A5 (d) mind

A6 (b) on

A7 (c) card

A8 (b) end

A9 (d) park

A10 (c) show