Tablet Computer Market Analysis (Economics)
EC180 Economics Assignment
Tablet Computers Market
Table of Contents
Table of Contents 2 Brief Introduction 3 1. Factors affecting Demand 4 2. Price and Income Elasticity 6 3. Price Discrimination 8 4. Fixed and Variable costs 9 5. Scale Economies 10 7. Market Structure 12 8. Barriers to Entry 13 Summary and Conclusion 14 References 14
Brief Introduction
In this report, the market of ‘Tablet Computers’ will be analysed. ‘A tablet computer is a complete mobile computer, larger than a mobile phone or personal digital assistant, integrated into a flat touch screen and primarily operated by touching the screen’ Editors PC magazine (2010).These products are gaining increased popularity in today’s world. Apple, Microsoft and Lenova are already in this market, with Apple’s popular product, the ‘I pad’ leading the market share. This relatively new market `will be thoroughly investigated using various microeconomic theories and findings.
1. Factors affecting Demand
In economics, demand is defined by the desire to own anything, the ability to pay for it, and the willingness to pay (Sullivan & Sheffrin,2003a)
The diagram below shows the demand curve. Factors affecting demand would cause a shift in the demand curve. An increase in demand will cause an outward shift to the demand curve (D1 > D2), thus increasing the market equilibrium price. A decrease in demand on the other hand will cause an inward shift of the demand curve ( D1 > D3), decreasing the market equilibrium price. The diagram proves the ‘Law of Demand’ which states that quantity demanded for a good decreases as the prices increases.
The following are the factors that affect the demand of a good or service. * Price * Income * Substitutes: Price of substitutes * Trend * Number of consumers in the market/ population
Price: One of the main factors affecting demand would be the Price of the product or service. There is an inverse relationship between the price of
Tablet Computers Market
Table of Contents
Table of Contents 2 Brief Introduction 3 1. Factors affecting Demand 4 2. Price and Income Elasticity 6 3. Price Discrimination 8 4. Fixed and Variable costs 9 5. Scale Economies 10 7. Market Structure 12 8. Barriers to Entry 13 Summary and Conclusion 14 References 14
Brief Introduction
In this report, the market of ‘Tablet Computers’ will be analysed. ‘A tablet computer is a complete mobile computer, larger than a mobile phone or personal digital assistant, integrated into a flat touch screen and primarily operated by touching the screen’ Editors PC magazine (2010).These products are gaining increased popularity in today’s world. Apple, Microsoft and Lenova are already in this market, with Apple’s popular product, the ‘I pad’ leading the market share. This relatively new market `will be thoroughly investigated using various microeconomic theories and findings.
1. Factors affecting Demand
In economics, demand is defined by the desire to own anything, the ability to pay for it, and the willingness to pay (Sullivan & Sheffrin,2003a)
The diagram below shows the demand curve. Factors affecting demand would cause a shift in the demand curve. An increase in demand will cause an outward shift to the demand curve (D1 > D2), thus increasing the market equilibrium price. A decrease in demand on the other hand will cause an inward shift of the demand curve ( D1 > D3), decreasing the market equilibrium price. The diagram proves the ‘Law of Demand’ which states that quantity demanded for a good decreases as the prices increases.
The following are the factors that affect the demand of a good or service. * Price * Income * Substitutes: Price of substitutes * Trend * Number of consumers in the market/ population
Price: One of the main factors affecting demand would be the Price of the product or service. There is an inverse relationship between the price of
References: Carlton D. and Perloff M, "Modern Industrial Organization" Fourth Edition, 2005 Editors PC Magazine. "Definition of: tablet computer".PC Magazine. Accessed April 17, 2010. Krugman, Paul R.; Maurice Obstfeld (2003). "Chapter 6: Economies of Scale, Imperfect Competition and International Trade". International Economics - Theory and Policy (6th ed.). p. 142. Sullivan, Arthur; Steven M. Sheffrin (2003a). Economics: Principles in action. Upper Saddle River, New Jersey 07458: Pearson Prentice Hall. pp. 79. Sullivan, arthur; Steven M. Sheffrin (2003b). Economics: Principles in action. Upper Saddle River, New Jersey 07458: Pearson Prentice Hall. pp. 157.