news analysis for economics..need help?
let’s say, X , is a major retailer, and had taken a step in excelling their rival, Y Group by luring additional customers with low prices. As a result, there was a tremendous boom in X’s sales growth and more to be expected in the near future.
how will the demand and supply curve looks like before and after the step of lowering price is being taken by X?
how can i relate the situation above with concepts :-
– law of supply / demand
– conditions of supply/ demand
– reasons for shift in supply/demand curves?
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before: X shows a break even when comparing lower prices vs high output. Once Y has gone out of business, expect X to slowly invert it’s curve with no competition ( they raise their prices and make a killing, rather than doing volume sales.)
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