factors that affect the demand and supply of iPhones in the market and the effects of the changes on the price
An iPhone is a phone produced by the American technology company Apple. The product has a series with various phones such as iPhone 3, iPhone 4, iPhone 5, iPhone 6, iPhone 7, and the latest iPhone 11 pro, among others. The company has customers worldwide, and thus it has branches in most parts of the world. The immediate competitors of iPhone products are Samsung Company based in South Korea. This paper will discuss the factors that affect the demand and supply of iPhones in the market and the effects of the changes on the price.
The first factor that influences demand is the taste and preferences of the consumers. The Apple Company is aware of the specifications that will make their phones more attractive to customers. In its series, each new model manufactured features new advancements of the previous iPhone. Most of these advancements include security, speed, camera quality, storage space, and battery life. Customers are in great need of more secure, speedy, and high storage phones. For instance, the iPhone 11 Pro specifications include 64GB/256GB/512GB storage, 4GB RAM, 12MP 2160p camera and 3046mAh. Don't use plagiarised sources.Get your custom essay just from $11/page
The second factor influencing the demand of the iPhone is the model of the phone. As stated above, there are various series of iPhones in the market. However, the demand is different from one model to the other. The products that were later released to the market have high demand than the older ones. In this case, iPhone 11 Pro, which was released in 2019, has more need than iPhone 5, which was released in 2012.
The third factor affecting the demand of the iPhone is the changes in the price of the related products. As stated above, the principal competitor of iPhone phones is Samsung phones. The cost of Samsung phones in the market affects the demand of iPhone phones. For instance, Samsung Galaxy M30s phone offers iPhone 11 Pro phone direct competitions. If there is a decrease in its price, its demand will be high, and the iPhone 11 Pro demands will be below.
Some factors influence the supply of iPhone phones. The supply of iPhone products will significantly be related to the prices of related goods. The decrease of Samsung galaxy M30s increases its supply to the market because more customers are buying it. In turn, this decreases the supply of iPhone phones, because its phones are not in well selling.
The second factor is government policies. Apple Company is a global company, and thus it sells iPhone phones all over the world. However, different countries have different taxation policies. The supply of iPhone phones is high in countries with low tax on excise duty. On the other hand, in countries with high taxation on imported goods, then the supply is low.
The third factor is the income level of the consumers. Being expensive phones, iPhone phones are associated with the rich, and only a few people can afford it. The supply of iPhones is high in developed countries like the US, China, Spain, and the UK. This is because it is likely that the phones will be highly bought. On the other hand, the supply is low in Africa and other developing countries because many people cannot afford it.
All of these factors affect the equilibrium prices of iPhone products. An increase in demand leads to an increase in the prices to ensure the supply maintains at equilibrium. For instance, the demand for iPhones in America is high, and thus its prices are also elevated to keep the law of supply and demand. On the other hand, the demand for the iPhone in South Korea is low due to competition by home-based company Samsung. As a result, iPhones are cheaper in the country to have a competitive advantage to Samsung phones.
The price of iPhones is expected to go down with time. The demand for the phones is expected to decrease with time, as many people continue to acquire it. Also, the price for the available products will drop with the introduction of a new product in the market. Lastly, naturally, phones lose value with time, and thus IPhones apply to this rule contributing to its decrease in price.