Law Of Demand Essay

683 words - 3 pages

The law of demand is one of the most basic principles of economics. Most economic theories however is based on the concept that the consumer would always make the most logical and prudent choices when faced with a decision what will provide them some satisfaction (Getzen, 2010). With everything else being constant, quantity is inversely related to price. This concept can be used to predict consumer behavior and can be applied in health care to the behavior of patients. Other factors however affects the law of demand such as income, preferences or tastes, and expectation but ultimately the most deciding factor in price. Understanding these pattern on a time period can help health care ...view middle of the document...

In this case the demand increased, then she increased the supply as well to deal with the demand, and because the services provided by medical student is free, she just has to sign a few paper work and she is also compensated by the medical institution for her time, she further increased her demand.
Economist use an engineering concept knows as elasticity to measure the sensitivity of price. A price point is said to be elastic if the amount of quantity demanded is changed rapidly by a change in price. The equation elasticity is equal to percent change in quantity divided by percent change in price indicates that if the price changes rapidly and the price sensitivity is inelastic then the quantity demanded would barely change. So it can also be describes as the percentage change in quantity demanded for a one percent change in price (Getzen, 2010). My example in this situation would be inelastic. A small change in the amount of patients needing physicals would not drastically change the...

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