Demand and Supply Notes (TMPE3) PDF

**Notes (TMPE3)** **Demand and Supply** - Demand is downward sloping because Price (P) and Quantity (Q) has a negative relationship. - A negative relationship in this case means that as Price increase, Quantity Demanded decrease or as Price decrease, Quantity Demanded increase. -...

**Notes (TMPE3)** **Demand and Supply** - Demand is downward sloping because Price (P) and Quantity (Q) has a negative relationship. - A negative relationship in this case means that as Price increase, Quantity Demanded decrease or as Price decrease, Quantity Demanded increase. - Supply is upward sloping because Price (P) and Quantity (Q) has a positive relationship. - A positive relationship in this case means that as Price increase, Quantity Supplied increase or as Price decrease, Quantity Supplied decrease. - The demand side is usually in the perspective of consumers/buyers while the supply side is usually in the perspective of the producers/sellers. - The point where Demand and Supply meet is called the Market Equilibrium. In this point, both the seller and the buyer agree to sell and buy an amount of Q at a specific price. There is agreement, in short. **Movement vs Shift in the Demand and Supply Curve** a.  b. - Movement along a single demand curve is caused by price variable (as seen in a). - There is change in the quantity demanded caused by the changes in the price (as seen is a). - Holding supply constant, the shift in the quantity demand is caused by non-price variables like income, preference, and many more (as seen in b). a\.  b. - Movement along a single supply curve is caused by price variable. - There is change in the quantity supplied caused by the changes in the price. - Holding demand constant, the shift in the quantity supplied is caused by non-price variables like technology, number of competitors, and many more (as seen in b). **Surplus and Shortage**  - Surplus happens when S \> D. Producers/Sellers suffer. The government can intervene and implement a price floor, the lowest price that can be paid for the goods and service. This is to protect the producers/sellers. - Shortage happens when D \> S. Consumers suffer. The government can intervene and implement a price ceiling, the highest price that can be charged for goods and services. This is to protect the consumers. **Marketing Definition (Old vs. New)** - Old definition is transactional only. Focus on sell, sell, sell. - New definition of marketing involves building relationships with customers. This is because they the emphasis now is to have loyal customers that will ensure the longevity of the business. It is not enough to just sell, there must also be a 2-way communication between the business and customers so that the business can provide the needs and wants of their customers. **Supply and Demand in the Tourism Industry** - The supply side is comprised of the destinations that can range from barangays, municipalities, provinces, regions, countries, continents, and so on and so forth. These destinations have characteristics like culture, attractions, politics, activities, brand, image, and many more. This attracts potential tourists. - The demand side is composed of the consumer (individual and group), business groups, and government. They can also be categorized as domestic or local and foreign or international tourists. These consumers have motivations, characteristics, and such that influence their choice of destination. - Between the supply and demand, there are channels. - We can use this info to derive a Destination Marketing Framework. **Destination Marketing Framework**