posted by anthony on .
a decrease in demand for a product, holding other things constant, will
What are your choices?
will result in less people buying the product, a surplus of the product, the company reduces its price and therefore its supply....to make the supply within a closer ratio between supply:demand therefore allowing its company to sell the goods at the base price ...but the company now has to cut its payroll because they are making less off that product, it took people to make that product. less product moving off shelves means less workers to produce it. the workers get fired....this causes them not to spend as much...therefore decreasing the demand and this is the recycle affect.