Rasmussen College iPhone 6 Plus Total Economic Output Project

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Question Description

This course project assignment is focused on total economic output. This week you will be asked to continue your research of the iPhone 6 plus.

Include the following:

  • Research and discuss how economic fluctuations affect the sale of the iPhone 6 plus.
  • Discuss what type of unemployment would result if the economies of the United States and China began to contract and why.
  • Identify the four causes of unemployment and state whether or not any of the causes of unemployment affect the market of the iPhone 6 plus.
  • Describe how unexpected inflation in the United States would affect the sale of the iPhone 6 plus.

Your paper should include:

  • Title page
  • Introductory paragraph that previews topics to be discussed in your paper
  • Each of the four topics must be at least 2 or more sentences (sentences should read paragraphs) in length, a paragraph should be at least 4 or more full complete sentences in length
  • Conclusion to summarize key topics
  • In-text citations and references to include reference page
  • At least 700 words or more in length
  • APA format

Unformatted Attachment Preview

Running head: SUPPLY AND DEMAND Supply And Demand: iPhone 6 Plus Jolanda Harrison Principles of Economics July 14, 2019 Rasmussen College 1 SUPPLY AND DEMAND 2 iPhone 6 Plus Starting at 299 dollars apiece, the iPhone 6Plus registered 13 million users by the end of March 2015 (Kelly, 2014). The demand was more significant than the supply at a price set by Apple for the smartphone; hence, the phone faced a shortage in the market. Therefore the initial price was below equilibrium. Demand Curve A decrease in demand for the product will see the demand curve shift to the left. This shift can be caused by factors such as a negative review on the product, or fall in the price of a substitute or even government warnings on specific products. All of these factors influence consumer preferences. An increase in demand is indicated by a shift of the demand curve to the right, which implies an increase in the quantity demanded at every price. Two factors that could lead to a product being demanded more could be a rise in consumer income or the fall in the price of a complement. Increase in income is a significant factor since individuals will want a product even if it is highly-priced since they can afford it. On the other hand, when a compliment is cheaper, the consumer can afford them as a pair (Xaxx, 2019; Sata, 2013). Supply Curve A rise in production cost will see the supply curve shift left, indicating a reduction in quantities produced and consequently supplied. An increase in input costs, for instance, will see a firm use more to produce one unit of product; hence, they will produce and supply less. Unfavorable government policies such as excessive taxation and regulation also increase the cost of production, making the firm provide less of a product, shifting supply curve left. SUPPLY AND DEMAND 3 The Supply curve will shift to the right if the prices of inputs fall. This movement implies that if the cost of iPhone components is cheap, then Apple would be motivated to produce more units of their products to sell and make more profits (Sata, 2013). This action would increase the number of product units supplied, shifting the curve to the right. Government policies may also affect the supply making it shift to the left through lowering taxes and friendly regulations and subsidies. Since all these governmental actions affect production costs, a reduced production cost is a motivation to produce more, shifting supply right. Market Failure Market failure occurs in the event of an inefficient allocation of resources in a free market. The iPhone 6 Plus was a case of market failure as a result of the already mentioned sate of disequilibrium, where the quantity demanded was not equal to that supplied by Apple. This disequilibrium may have been a result of Irrational Exuberance where people got carried away by the release information of the phones and could not make rational decisions, resulting in a shortage despite the costs being quite high. SUPPLY AND DEMAND 4 References Kelly, G. (2014, September 15). iPhone 6: Apple Confirms Record Pre-Orders And Big Supply Shortage. Retrieved from Forbes: https://www.forbes.com/sites/gordonkelly/2014/09/15/iphone-6-supply-shortage-appleconfirms-record-4-million-pre-orders/#1f25001464e0 Sata, M. (2013). Factors Affecting Consumer Buying Behavior of Mobile Phone Devices. Mediterranean Journal of Social Sciences, 4(12), 103-112. Xaxx, J. (2019). Factors Affecting the Market Demand & Supply for Mobile Phones. Retrieved from Techwalla: https://www.techwalla.com/articles/factors-affecting-the-marketdemand-supply-for-mobile-phones ...
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Tutor Answer

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School: Cornell University

Attached.

Running head: CONSUMER DEMAND ANALYSIS

Consumer Demand Analysis

Name

Institutional Affiliation

1

CONSUMER DEMAND ANALYSIS

2

Consumer Demand Analysis

Economic fluctuations, unemployment, inflation all impact the demand and supply of
goods. Taking the example of the iPhone 6 Plus, the present analysis investigates how such
factors impact the sale of the product.

How Economic Fluctuations Affect the Sale of the IPhone 6 Plus

Like other iPhone releases, the iPhone 6 plus was received with high expectations as
consumers ordered the gadget at a speed that Apple could not deliver. Considering the premium
pricing on the product, a decline in market demand would result in reduced number of sales for
iPhone 6 plus phones. If there was an increase in the national income, this would be indicative of
economic growth, which would mean that consumers would have more disposable income to
spend on iPhones. The increase in national income would result in increased demand and supply,
resulting in more sales.

Unemployment That Would Result If the Economies of the United States and China Began
To Contract and Why

If there was a contraction in the economies of China and the United ...

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