Friday, March 14, 2014
Ahhh Elasticity
This week we learned all about rubber bands, i mean elasticity. But the two really aren't so different. They both show the stretchiness, or in the case of economics, the sensitivity to which consumers or producers change their demand in response to price or income changes. One can calculate it, and decide whether they should raise or lower their price depending on how they think the reaction will affect their sales. To me this seems pretty incredible, the power to change a price to get the most amount of money you can. We also were in groups to make an advertising ad for Weserville. We had to try to find the best factor that can change the demand for a product, and in this case it was Weserville. There were many exciting tv, radio and newspaper ads that all showed some of the factors. If you were a producer of a product how would you change your price to make the best choice for the company?
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This week was definitely fun dealing with elasticity and all that good stuff. I wish we had actually got rubber bands to like fling at each other, I don't know.. anyways, I think you have a good question at the end of your post, and to answer, I would say that it depends on what type of business I am running here. Making the best choice for my company would entail making the most profit for not only myself, but my workers, while giving the consumers a reasonable deal. If I were in the insulin business, I would have more room for unreasonable prices or abuse, while if I were making TV's or expendable goods, then I might be more cautious on my product pricing. I like your reflection on this week, and I also enjoyed seeing all of the creative sides of my classmates. I am excited to be learning about supply this week!
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