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Economic and management sciences

Grade 7

Economic principles

Module 2

Demand and supply

What is meant by demand and supply?

Before motor cars appeared on our roads, people used to travel on horseback. Supposing everybody decides to start travelling by car, instead of on horseback. What will happen in everyday life?

  • Does the government decide to build factories in Uitenhage and tell workers to relocate and work in the factories?
  • Are horse-breeders told to scale down on horse-breeding?
  • Does government decide that it would be better to start growing cotton for upholstering car-seats, and that less hay should be grown to feed the horses?

Of course government did nothing of the kind. Consumers bought more motor cars and fewer horses. What happens now?

  • Due to higher profits in the motor car industry, more car factories are erected, and workers move to those areas to find jobs.
  • The price of horses drop, and horse-breeders find other ways of making money.
  • As less hay is needed for feeding the horses, the price of hay comes down and other crops have to be planted.
  • At the same time the demand for raw materials such as steel, cotton and rubber increases, as it is needed for the manufacturing of cars. As the prices of these commodities also escalate, more businesses turn to manufacturing.

Eventually the demand for horses decreased by 90% in the previous century, while millions of cars were manufactured.

What was the reason for this revolution? It was caused by changes in buyers’ preferences and new technology resulting from the forces of demand and supply.

Similar changes constantly occur in the economic field, as buyers’ preferences change and new production methods are developed.

“Free” and “Economic” goods

Free goods

When goods exist in such large quantities, like e.g. seawater or air, we can use as much of it as we wish, without paying for it. In other words, it is freely available to all.

Economic goods

When something is scarce and there is a big demand, we have to pay for it. These goods are not always plentiful, and the less there is, the more we have to pay for it.

If everything that we need is plentiful, and the prices are low, we will all lead comfortable lives, and no-one will be worrying about the distribution of income among people. Everybody will be able to have as much as they want, of whatever they want. In such a society of prosperity, there will be no economic goods.

Activity 1:

To distinguish between wants and needs

[lo 1.1]

  • What is the difference between wants and needs ?
  • Write the following items in the appropriate column:

CD’s, bicycle, ski-vacation, swimming-pool, iPod, medical services,

cellphone, bread flour, clean air, purified water

Needs Wants

Far too many flat-screen television sets

All of a sudden there is a surplus of high technology flat-screen lcd television sets. Or rather, there are far more of them in the shops than consumers want to buy. World market-leaders Samsung and LG Philips overestimated the demand for flat screens when they invested tens of millions of rands in new factories over the past few years.

Questions & Answers

where we get a research paper on Nano chemistry....?
Maira Reply
what are the products of Nano chemistry?
Maira Reply
There are lots of products of nano chemistry... Like nano coatings.....carbon fiber.. And lots of others..
learn
Even nanotechnology is pretty much all about chemistry... Its the chemistry on quantum or atomic level
learn
Google
da
no nanotechnology is also a part of physics and maths it requires angle formulas and some pressure regarding concepts
Bhagvanji
Preparation and Applications of Nanomaterial for Drug Delivery
Hafiz Reply
revolt
da
Application of nanotechnology in medicine
what is variations in raman spectra for nanomaterials
Jyoti Reply
I only see partial conversation and what's the question here!
Crow Reply
what about nanotechnology for water purification
RAW Reply
please someone correct me if I'm wrong but I think one can use nanoparticles, specially silver nanoparticles for water treatment.
Damian
yes that's correct
Professor
I think
Professor
Nasa has use it in the 60's, copper as water purification in the moon travel.
Alexandre
nanocopper obvius
Alexandre
what is the stm
Brian Reply
is there industrial application of fullrenes. What is the method to prepare fullrene on large scale.?
Rafiq
industrial application...? mmm I think on the medical side as drug carrier, but you should go deeper on your research, I may be wrong
Damian
How we are making nano material?
LITNING Reply
what is a peer
LITNING Reply
What is meant by 'nano scale'?
LITNING Reply
What is STMs full form?
LITNING
scanning tunneling microscope
Sahil
how nano science is used for hydrophobicity
Santosh
Do u think that Graphene and Fullrene fiber can be used to make Air Plane body structure the lightest and strongest. Rafiq
Rafiq
what is differents between GO and RGO?
Mahi
what is simplest way to understand the applications of nano robots used to detect the cancer affected cell of human body.? How this robot is carried to required site of body cell.? what will be the carrier material and how can be detected that correct delivery of drug is done Rafiq
Rafiq
if virus is killing to make ARTIFICIAL DNA OF GRAPHENE FOR KILLED THE VIRUS .THIS IS OUR ASSUMPTION
Anam
analytical skills graphene is prepared to kill any type viruses .
Anam
Any one who tell me about Preparation and application of Nanomaterial for drug Delivery
Hafiz
what is Nano technology ?
Bob Reply
write examples of Nano molecule?
Bob
The nanotechnology is as new science, to scale nanometric
brayan
nanotechnology is the study, desing, synthesis, manipulation and application of materials and functional systems through control of matter at nanoscale
Damian
Is there any normative that regulates the use of silver nanoparticles?
Damian Reply
what king of growth are you checking .?
Renato
What fields keep nano created devices from performing or assimulating ? Magnetic fields ? Are do they assimilate ?
Stoney Reply
why we need to study biomolecules, molecular biology in nanotechnology?
Adin Reply
?
Kyle
yes I'm doing my masters in nanotechnology, we are being studying all these domains as well..
Adin
why?
Adin
what school?
Kyle
biomolecules are e building blocks of every organics and inorganic materials.
Joe
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Source:  OpenStax, Economic and management sciences grade 7. OpenStax CNX. Sep 10, 2009 Download for free at http://cnx.org/content/col11025/1.1
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