Market Equilibrium is a condition where buyers establish a market price through competition such that the amount of goods or services sought. During the week, we have read Chapters 1-3 which deals with the market system as well as the supply and demand. Demand is a schedule that or a curve that shows the various amounts of a product that consumers are willing and able to purchase at a time of possible prices during a certain amount of time.
The industry to talk about with market equilibrium process is the automotive industry. During the last couple of years, there has been many downfalls in the industry. Ford Motor Company has taken the biggest fall compared to DaimlerChrysler and GM.
Car sales declined in the country affecting the U.S. as well as foreign manufacturers. Ford acquires bridging loans, which is somewhat of bailout money in which the company borrows from the government in order to make a certain profit. The bridging loans lead to greater scrutiny of the US automotive industry in addition to criticism of their product range, product quality, high labor wages, job bank programs, and healthcare and retirement benefits.
The product in a situation like this is that the industry is in a downfall and is slowly moving progressing. In 2009, President Barack Obama passed “Cash 4 Clunkers” bailout money in which consumers had a chance to purchase a brand new car with trading their use car as a down payment. Many of the dealerships achieve sale goals due to the fact that the bailout was a way to get the automotive industry back on track. With all that said, the industry is still taking a turmoil especially in the foreign automotive industry.
Market Equilibrating Process Paper 3
Toyota recently recalled numerous cars with faulty gas pedals and that was a big net loss of...