Micro Part 2 - Demand Determinants Consumer Income o The...

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Demand Determinants: Consumer Income o The higher the consumer’s income the more money they are willing to spend in the store. Consumer Taste o Consumer’s are looking for certain kind of product and a certain style of clothing, the store needs to have the clothes that are “in style” Price of Other Goods o If another company’s prices are cheaper then the consumer will be more willing to buy their products over the more expensive company. Supply Determinants: Price of Resources o If the resources are cheaper then the company can buy more of the resource and in turn make more of the products at a lower price, therefore increasing the supply. Producer Expectations o For example, during the holidays the company could expect more customers to buy more of their products and therefore would increase their number of supply. Ease of Entry or Exit of the Industry This is Monopolistic Competition industry, and the entry and exit in this industry is fairly easy. Because there are so many different producers it make it an easy industry
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