Project on Global PC Market.

1.Model the international market for personal computers.

Demand

In current world market, it is only when reasonable to consider PCs to be an essential commodity for the fair house hold. This would mean that people would still buy computers scorn higher sets and not buy more in the causal agency of lower prices.

Therefore, we conclude that the inquire for PCs is not overly bleak to price changes and is relatively inelastic; hence the steeper make curve. The fact that we consider the PC market as a whole group and not a particular grease or a subgroup of PCs, further justifies this conclusion.

Still, with new(prenominal) things being equal, the demand pull up stakes decrease with increasing price as the jurisprudence of Demand suggests. However, most of the time, the percentage change in price will be larger (in absolute value) than that in the demand.

Supply

The global PC market is a highly competitive sensation with everyone trying to provide for the lowest possible price (or suppliers will have to quit the industry in case they basisnot supply at the market price). The supply curve would still preserve the Law of Supply (Other things being equal, higher price is bonus for suppliers to supply more) but would be more gradual. In other words change in quantity traded is very unsanded to price changes.

The intersection point of these two curves will make up the equilibrium price. i.e. where supply meets the demand.

2.What trends do you think are occurring in the global market for personal computers? Illustrate these using your poser of the market developed above.

As the computer technology becomes cheaper all the time, the PC price is decreasing almost continuously.

This leads to a movement along the demand curve as illustrated in the next page.

Also, we can expect an overall shift towards...

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