Is it possible to affect price of commodities?
|
  |
|
|
| Author |
Message |
leontine
Apprentice
Joined: 09 May 2004
Posts: 4
|
 Posted: 06/21/08 - 05:54 Post subject: |
 |
|
| Hi there everybody! My name is Sarah and I was wondering if you could give me the explanation about price formation. How do prices form on the market? Is it possible to affect price of commodities? Thank you in advance for your posts. I am really looking forward to them. Bye! |
|
|
Back to top
|
|
|
|
 |
say
Apprentice
Joined: 28 Nov 2006
Posts: 3
|
| Posted: 07/20/08 - 21:27 Post subject: |
|
|
| Hello Sarah. Here’s the thing. Prices are formed on the basis of supply and demand. When supply is big and it exceeds demand for that commodity, price will fall. Then, because of the low price, consumers will start to buy that product and the price with start to rise. In other case, when demand is higher than supply, price will increase. Since there will be no buyers, price will have to fall. Now, individuals or companies can affect price of commodities if they can affect supply or demand. For example, in case of monopoly, some company can limit supply and therefore lead to the price increase. That’s why competition on the market should be encouraged. That is all I wanted to tell you. I hope that I was of some use. Bye! |
|
|
Back to top
|
|
|
|
|
|
| |
All times are GMT
|
| Page 1 of 1 |
Related topics: | |
|
|
