1. MARKETING MR. LOCKE Observing the Law of Supply and Demand

2. Macroeconomics Studies the economic behavior and relationship of an entire society  The US Department of Commerce  An entire grocery store chain (Kroger, Wal-mart)

3. Microeconomics Examines the relationship between individual consumer and producers Studies how individuals make decisions about what to produce and what to consume Marketers care most about microeconomics

4. Marketers and Microeconomics Marketers care about information  About how consumers make purchasing decisions  How much consumers are willing to pay  How a business’s competitors make decisions about what and how much they will produce  How much a business’s competitors will charge for a product

5. Factors Affecting Demand 1-A need or want is particularly important or strong, a consumer may be willing to spend more money to satisfy it  Buying t-shirts at a baseball game if the player has a good game

6. Factors Affecting Demand 2-Available supply of products and services to satisfy needs  A large supply will lower the value placed on that product/service  Shoe store with a large supply of Nike Shox, consumers will pay less for them  Shoe store with a small supply of Nike Shox, consumers will pay more for them

7. Factors Affecting Demand 3-Availability of alternatives. If consumers believe there is no alternative, they are willing to pay more  Gas-there are limited alternatives for gas-consumers will pay more  Pepsi-there are several alternatives for Pepsi-if the price goes up consumers will buy the alternative

8. Demand Curve Demand curve-the relationship between price and the quantity demanded Demand curve-downward sloping Law of demand-As the price decreases quantity demanded will increase

9. Supply Curve Supply curve-the relationship between quantity supplied and price Supply curve-upward sloping Law of supply-When the price of a product is increased, more will be produced

10. Handling the Competition Businesses consider the amount and type of competition  Intense competition results in fewer opportunities  Affects the supply curve Economic resources-Natural resources, capital, equipment, and labor  The specific types of resources a business has available will determine the types of products and services it can develop and sell  Affects the supply curve

11. Supply and Demand Curve The intersection of the supply and demand curve- Market Price, or Equilibrium