0 like 0 dislike
29 views
in Science by (1.0m points)
Illustrate the relationship between producers and consumers.

1 Answer

0 like 0 dislike
by (1.0m points)
Producers and consumers are connected by trade and prices. Economic forces like supply and demand determine the extent of the relationship between producers and consumers in a given market.

For example: If bananas are in high demand during the winter, producers will have to up their production to meet consumer expectations. Conversely, if bananas fall in demand, producers will need to scale back production accordingly.

Quantities demanded and supplied are only one half of the equation however. If bananas are falling in demand, the price producers are charging must also fall, otherwise they won’t be able to sell any bananas, and vice verca.

Thus, the relationship between producers and consumers is mutually beneficial, which is why they work together on many aspects of trade. It’s important to note that the extent of the relationship between the two also depends on the economy and the type of market for the specific product or service being provided.

For example: OPG (Ontario Power Generation - supplies electricity to Ontario, Canada) used to have a monopoly over Ontario’s power supply. When a firm controls a monopoly (which is extremely rare to see in today’s world) they can charge a much higher price than possible with competition. Now this doesn’t mean that they can charge exuberant amounts for their product, but without competition, they are free to explore many more paths to delivering their product to consumers.

I live in Canada, which has a mixed-market economy. Thus, producers and consumers in this type of market are interrelated in all things that have to do with supply and demand forces.

Related questions

0 like 0 dislike
1 answer 30 views
0 like 0 dislike
1 answer 49 views
0 like 0 dislike
1 answer 21 views
0 like 0 dislike
1 answer 135 views
0 like 0 dislike
1 answer 104 views
0 like 0 dislike
0 answers 23 views
0 like 0 dislike
1 answer 42 views
0 like 0 dislike
1 answer 54 views
0 like 0 dislike
0 answers 81 views
Welcome to Free Homework Help, where you can ask questions and receive answers from other members of the community. Anybody can ask a question. Anybody can answer. The best answers are voted up and rise to the top. Join them; it only takes a minute: School, College, University, Academy Free Homework Help

19.4k questions

18.3k answers

8.7k comments

3.3k users

Free Hit Counters
...