Economics FA

Microeconomics Commentary
Satvik Gupta

Rationale:
For this task, I have decided to comment on the relationship of demand, supply and
elasticity due to the fact that the commentary is very well illustrating these 2
concepts. Ill be including diagrams of them as well. When we apply these economic
concepts, this can help governments and individuals to make informed decisions.

Commentary:
The commentary is illustrating 2 major concepts of economics which are supply and
demand. Demand is an economic principle that describes a consumer's desire and
willingness to pay a price for a specific good or service. Holding all other factors
constant, an increase in the price of a good or service will decrease demand, and
vice versa. On the other hand, Supply describes the total amount of a specific good
or service that is available to consumers. Equilibrium price and quantity are
determined by the intersection of demand and supply. In the graph below, the
markets for Chilli are shown:-
Demand for chilis in this market, is high
due to the sacred supply as chilli crops
were down by 15-20 percent due to
erratic ranis last year, because of the
sacred supply, prices are increased to 95-
100 rupees a kg which is 20 percent
more than the prices year ago.