ECONOMICS FOR MANAGERS Essay Example | Topics and Well Written Essays - 1500 words

ECONOMICS FOR MANAGERS - Essay Example Hence, a graphical representation of the price of copper is to be elaborated since 2008 to 2014 to understand the economic facets that affect the price considerably. Contextually, copper is traded in the commodity market and it is used immensely in the everyday lives of people. The fluctuation in the copper prices helps in indicating the state of the economy at large in the global platform. The price of copper is linked with various economic variables (ABN AMRO, 2014; ECORYS, 2012). In this section, the paper intends to evaluate the reasons using economic analysis for the price fluctuations and its impact. Firstly, demand is linked with the requirements of the consumers for a particular product. The demand theory finds a strong relation amid product requirement and price. This theory is elaborated through the help of the diagram below: It is observed that if the purchasing power is high, then the demand increases and likewise, the price get affected. Therefore, in the context of demand it can be stated that various factors affect the price of copper in the economy including the demand and supply of copper and the commodity market influences. Secondly, another aspect is the supply theory, which is also linked with the quantity demanded and supplied. Alteration in the price of goods such as copper also affects its supplied quantity. This is depicted through the diagram below: In relation to the demand and supply theory, it can be stated that copper depicts volatility in the market affecting its price based on the demand and supply of the commodity (Knittel & Pindyck, 2013). In this context, it is vital to state that copper is regarded as luxurious, because of its high demand and supply factor. It is a fact that copper is obtained through mining and it is expensive, because of its rare availability. However, it is easier to get recycled copper at a cheaper price, as it is attained from old and new