Eko & Miya - Supply at Demand

Summary

In this conversation, Eko buys a glass of coconut juice for ten pesos, noting that it was fifteen pesos just recently. The vendor explains the concept of supply and demand, highlighting how prices fluctuate based on availability and customer demand. When there’s an oversupply and fewer buyers, prices drop. Conversely, prices rise when demand exceeds supply, such as during holidays or summer when coconut harvests are low. The conversation ends with Eko and Miya learning about the dynamics of pricing, and the vendor joking about stock markets before suggesting they head home.

Takeaways

• 😀 Price fluctuations in markets are often influenced by supply and demand.
• 😀 When there is a surplus of supply and low demand, prices are lowered to encourage sales.
• 😀 If the demand increases and supply decreases, prices may be raised to balance the market.
• 😀 Market prices can be adjusted based on current conditions, such as an abundant supply of coconut or seasonal demand spikes.
• 😀 Price adjustments are made to ensure that sellers can still make a profit while meeting customer needs.
• 😀 In the example of coconut juice, the vendor reduces the price when there is excess stock to sell more.
• 😀 The concept of supply and demand is introduced to explain price dynamics.
• 😀 Demand can increase during specific times of the year, such as holidays or events like Christmas, which can drive prices higher.
• 😀 If prices are too high, fewer people may be able to afford the product, which can result in unsold stock for the vendor.
• 😀 Regular price changes don't happen daily unless there is a significant shift in the market conditions, like in the stock market.
• 😀 The conversation also touches on the idea that price changes are a natural part of business, but they depend on the situation at hand.

Q & A

Why did the price of the buko juice drop?

The price of the buko juice dropped because the supply of buko was high while the demand from customers, particularly students, was low. This imbalance led the seller to lower the price to encourage more people to buy.

What is the concept of 'supply and demand' that the vendor explained?

The vendor explained that when the supply of a product (like buko) is high and the demand is low, the price is lowered to attract more buyers. Conversely, if the supply is low and demand is high, the price tends to increase.

What happens when there is too much supply and not enough demand?

When there is too much supply and not enough demand, the seller may lower the price to avoid unsold goods. This way, more people are encouraged to buy at a lower price.

How does the vendor ensure they still make a profit despite lowering the price?

The vendor ensures they still make a profit by adjusting the price down but not below a level where they would incur a loss. They balance the price reduction with maintaining a reasonable profit margin.

Why does the vendor lower the price of buko juice during the day?

The vendor lowers the price of buko juice when the supply exceeds the demand, which helps to sell more and avoid wasting the product.

What could happen if the vendor kept the price of buko juice the same despite high supply?

If the price remained the same despite high supply and low demand, the vendor might struggle to sell all the buko, potentially leading to wasted goods.

Under what conditions does the vendor raise the price of the product?

The vendor raises the price when there is low supply but high demand. For example, during the summer when buko production is lower or during Christmas when demand for buko increases due to holiday-related purchases like buko salad.

What happens when the price of buko juice is raised due to high demand?

When the price is raised due to high demand, fewer people can afford to buy the buko juice, which could result in the vendor not selling as much as they would at a lower price.

What did the vendor mean when he said, 'It's not like the stock market'?

The vendor meant that prices for goods like buko juice don’t change daily in the same way stock market prices do. Price changes in the vendor’s business are based on supply and demand, not frequent market fluctuations.

What is the relationship between the characters Eko and Miya?

Eko and Miya are not classmates as initially thought. They introduce themselves to each other, with Eko revealing his name and Miya doing the same, showing that they are strangers meeting during this interaction.