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April 3, 2016 | Author: | Posted in economics, mathematics and economics


Demand remains probably the most important cog in the wheels of the economy and , ultimately , the quality of life of every individual will be affected by the relative health of the economy

The economy lives and dies by the double edged sword of supply and demand . When demand exceeds supply , prices will rise and profits will soar . When supply exceeds demands , prices drop and products are sold at reduced profits (or even outright losses ) to those few who hold an interest in the product . This creates a series of ripple effects [banner_entry_middle]

p If demand is high and profits soar , the value of the company that is introducing the product to the market place will rise . If this is a publicly held company , then those investors who hold shares in the stock will see their personal financial portfolio rise . As such , these people will see a rise in the quality of life . When supply exceeds demand , the inverse becomes the case

There are sociological issues at stake here as well . If demand remains high and not everyone is able to afford the product that is in demand there exists a desire to acquire that is not necessarily met . Such lack of ability to acquire what one demands can create a series of emotional responses ranging from a desire to improve one ‘s place in life so as to afford the product to a reaction of jealousy or entitlement or even a feeling of indifference Resource Payments

All forms of income whether it be investment income , wages , or rental income ultimately provide the financial security that an individual needs in to survive in the world . Outside of a communist state food and shelter is not guaranteed (not that communism provided those two things well ) and it must be purchased . As such , there needs to be a means of providing resource payments to individuals so they can take care of their basic needs in life

Of course , there are those who go beyond basic needs and seek luxury or even philanthropic pursuits . Regardless of the reasons behind this desire for financial gain beyond security , there always needs to be a constant stream of income /financial resources in to provide a baseline level of stability and security and (hopefully ) freedom from debt . Without these payments , no individual will have a financial infrastructure capable of supporting their life


There will always be a philosophical debate in regards to what is real or not real or what is tangible or intangible . To many people , economic theories remain exactly that .theories . They are intangible , true , but this does not necessarily mean that these theories do not exist However , many individuals are dismissive of economic warning theories and will continue down a path that will negatively affect them Unfortunately , some individuals learn painful lessons when it comes to discovering the realities of economic abstractions , but developing a working knowledge of economics on a practical level is usually one of trial and error… [banner_entry_footer]


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