DD202A

The market of cell phones is considered amazing paradigm about the

demand and supply curves. In the center of the essay, I will explain the factors that
affect on the demand and supply of the cell phones in the market. I will also
explain the factors that affect on the prices and the movement on the demand and
supply curve.

No doubt that there is phenomenon that done by many people in the market as they
always forecast some issues about the prices and quantities relating to the cell
phones in the future. These leaded to affect on the demand and supply of the
product. They predicted that the iphone 7 will decrease in the future because the
competition in the market will be high will be such as like Lenovo brands in
addition to increasing the producers of smart phones in the market.

We will interpret the graph of the Supply and Demand when reducing the
price of iphone7.

S1

S2
P1

P2
D2

D1
Q

Q1 Q2

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 The International Data Corporation (IDC) depend on many predictions correlating
to the prices which opened to alter in the future , there is detraction in the sold
products relating to the mobile phones through the different markets in the state of
Kuwait by 6 percent at 2016. The market relevant to the mobiles will dwindle;
because this issue relied on predicting by the global technology research. The
detraction is between 19 % and 22 % at 2016. These forecasting have big
implication relevant to the supply curve and demand curve because it is predicted
that purchasing relevant to the mobile phones will dwindle at 2016. Relating to
this condition , the quantity demanded relevant to the cell phones will dwindle
and the demand curve will move to the left.

Price of PHONES

Supply curve

P1

P2

D1

D2

Q.D of phones

Q2 Q1

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 Relevant to the the position of the nation and its economic position, GDP hinges
upon exporting the oil by 95 percent. Thus, we can remark that the purchasing
power of the Kuwaiti persons is relevant to the conditions of the prices that
relevant to the petrol sector. The detraction in the petrol prices in the global
markets levarged on the purchasing power in Kuwait. This detraction of demand
relevant to the mobile phones, and the demand curve relevant to the cell phones
moved to left.

Price of PHONES

Supply curve

P1

P2

D1

D2

Q.D of phones

Q2 Q1

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 The demand can be affected by many factors

The individual demand curve is made up of the prices specific products that are
purchase by the customer.

The market demand curve is made up of all the individual demand curves.

1. Change in price

Demand Curve of the iphone is affected by prices.

400

385

370 D

Quantity
20 m 25 m

Relevant to the Apple Company, they agree to dwindle the prices of iphone6 in
order to brace the demand for it. The prices dwindled from 400 to 370. These
supported demand of iphone to 25 million superior than 20 million.

Movement in the demand curve

There change in the demand curve through assuming that the prices are the same.
The customers has the options to buy large quantities or low quantities.

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 D2

D1

P1

QUANTITY
Q1 Q2

Diagram to show shift in demand

S
P1

P2
D2

D1
Q.S of tobacco

Q1 Q2

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The demand curve can be leveraged by important factors:

Income: - the fund that owned by the people in the market come from many
sources, but the most effective sources is the the income of the people that can rely
on it in order to buy the specific product in the market by part of his income. The
individuals will hinge upon the personal income to spend money for purchasing the
cell phone. The teachers in some countries take rewards at the end of the year,
these leaded to support their ability of demanding the iphone6. These leaded to
support the demand of the iphone 6 and the demand curve will shift to the right.

Quality: - iphone 7 depend on high quality and innovation like high pixel of
camera. These leaded to support the demand for the iphone7 and shifted to right
because the more customers pushed to purchase it. (Jagg Xaxx ,2015).

The amazing style of the advertisement works on seducing the different

customers in the world and there are many companies that manufacture cell phones
that designed effective marketing polices and advertisement like The Samsung
Company that supported the image of product by making Marvel’s Avengers”.
Messi is considered one who shared in this adv.

Substitutes: - the prices level for the apple products raised, these pushed the
customer to purchase Samsung products and the demand curve of Samsung shift to
right.

Complements: - the diminishing in the prices relevant to the complements. The

mobile phone’s demand will increase.

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The forecasting about the price; this factor play effective part in affecting the
demand curve like the prediction that tell that the prices of iphone 7s will
increase , these leaded to increase the demand for it in the current time and the
demand curve shift to the right. (Robin Wells,2012).

There are points that impacts on supply of cell phones

Prices of related products: - this point is relevant to the the company that
manufacture the cell phones. The apple is considered company that produces
many products like iphone and smart watches. The prices of the smart watches
increased in the international markets. So, the apple company focused on
producing smart watches more than I phone in order to achieve high profitability
by taking advantage of the increased prices in the smart watches in the market.
These leaded to increase the supply of the smart watches and reduce the supply of
the iphone as well as shifting the supply curve of smart watches to the right and
shifting the supply curve of the iphone to left.

Prices of inputs: - no doubt that the cost of the production of the iphone depend on
the basis of the materials that entered into the process of production. The cost of
production will increase if the prices of the material increase. The iphone rely on
gold and platinum to be produced. The costs of these inputs were rose, these
resulted to increase the cost of production and the supply curve of the iphone
reduced.

Expectations: - the supply of the smart phone in the world will be impacted by
manager’s prediction about the future.

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Number of sellers: the curve of the supply of the cell phone will shift to the right in
the case of there are many producers in the market.

The income and prices are considered factors that affect on the purchase decision
of the customers in the market to purchase specific phone. Galaxy Note 2 priced as
200 KD, while the income of the different people is KD 300 in average. These
leaded to dwindle the demand of the note 2, and demand curve moved to left. As
Iphone 5 appeared, these resulted to diminish the demand for the Galaxy S3.

At the end, I explained the demand and supply relating to the cell phone in the
market according to the factors that affecting on the demand curve and the supply
curve. The innovation and high technology have great affect on supply of The cell
phones such as the innovation that used in producing the Samsung product and
iphone. These leaded to shift the supply curve of them to the right. In the market;
Kuwait is considered country that many firms in the world like Apple Company
and Samsung Company. These companies aim to benefit from the high lifestyle of
the people in Kuwait and support their profits. The Kuwait majorly depends on the
oil exporting as the basis item in supporting the gross domestic product and the
national income of the country. The lifestyle and purchasing power of the Kuwaiti
people was reduced because of the reduction in the prices of the oil prices. There
are many new company appeared in the field of smart phones and csold their
products at cheap prices like VSun, and Xtouch.

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Reference

Alfred Mill,2016, Economics 101: From Consumer Behavior to Competitive

Markets - Everything You Need to Know About Economics (Adams ...

Econ Household,2015,Review of Economics of the Household , Springer US

ISSN: 1569-5239

Jagg Xaxx ,2015,Factors Affecting the Market Demand & Supply for Mobile
Phones,visited in 03-12-2016, available at :

https://www.techwalla.com/articles/factors-affecting-the-market-demand-supply-
for-mobile-phones

IDC,2015,Kuwait's Mobile Handset Market Set to Shrink in 2016, visited in 03-12-

2016, available at :-

http://www.idc.com/getdoc.jsp?containerId=prCEMA40706215

Maggie Mack,2012, Tobacco: Growing, Curing, & Manufacturing

Paul Krugman & Robin Wells,2012, Microeconomics ,ISBN:-744452269-44

Robin Wells,2012,Microeconomics