Business Ed: The Concept of the Invisible Hand (Demand & Supply)

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Greetings Members of campus connect, I previously attempted to get campus verification but to no avail I failed so I've again bigger and better with a wider understanding of Steemit. I want to make my first post out of two needed for verification to educate you all on a commonly taught concept in school called the forces of demand and supply. School isn't in session for a truck full of us so I decided to bring the school to the community.

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The invisible hand

This is a really simple concept and no rocket science. In a free market economy where the decisions are made by the people including prices of goods and services and what to buy and what not to buy. Humans are said to be very predictable when it comes to buying and selling of goods and services hence the invincible hand is another way economists use to describe the forces of demand and supply. So when ever you hear something is caused by the invisible hand, that simply means the thing is influenced by the forces of demand and supply.

Demand

From what we learnt in the university, Demand is the willingness and ability of a customer to pay for a good or service at a given period of time. So when ever you hear that something is in high demand, it simply means that potential customers that are willing and able to buy are available in large quantities and buying aggressively.

Factors affecting Demand & Supply

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Instead of over explaining in this section, I would just make an explaining sentence before going straight to an example for faster understanding. Demand for a certain product can vary and change due to the following factors;

° Price of the Product
The price of the product in demand determines how many people demand for the product. If a bucket happens to be really cheap then the people who buy buckets would increase.

° The number of consumers in the market
The amount of people in the market can determine the amount of people who demand for the goods. If you are selling wheelchair and I am selling phones, the demand for phones would be higher because everyone uses phones in comparison to wheelchairs.

° The Consumer's Income
The income of the consumer directly affects his demand. If my income was 500 steem every month and I buy 5 loaves of bread, then when my income increases to 750 steem I would be buying more bread meaning I have increased my demand for bread.

° The Price of Related Goods
This is where competition comes in especially when there are alternatives to the products you are demanding. If the price of toothpaste A is lower than that of toothpaste B, you as the consumer would tend to buy more of toothpaste A because it is relatively cheaper.

° The Preferences of consumers
Consumer taste and preference matters when it comes to demand. If you are a female consumer and you prefer flats to high heels then you would demand more of flats which increases the overall demand

° The Consumer's price Expectations
This is tricky but we as humans practice it every day. The future expectations for the changes in prices of the product also affects demand. If you hear that steem is going to moon by next week and you decide to act on it thereby increasing steem's demand.

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Supply

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Supply on the other hand is the amount of goods and services that the producers and suppliers are able to make available to the public for buying and selling. For example you hear that meme tokens have a very large supply, this means that there is a large amount of that meme token which has been made available to the public. Wow look at the time, it seems like this would be all for today folks please do well to follow up my page for more interesting economics lectures and sometimes you would get some Agricultural based lectures because that so happens to be one of my favorites.

Special thanks to @campusconnectng to whom I set 50% of this posts payout to inorder to hasten community verification

Cc. @steemcurator09