Employed Person in Different Jobs Case Study Example | Topics and Well Written Essays - 3750 words - 1

Employed Person in Different Jobs - Case Study Example This paper highlights that wine is considered a luxurious drink. In addition, wine costing  £10 a glass is quite expensive and this means such person will have foregone saving just to enjoy a glass of expensive wine. The implication of such spending is reduced level of saving since money which could be saved in spent on luxurious drinks. Further, such spending has far-reaching effects on investments since they are largely financed from savings. Wheat is a raw material used in the production of bread. An increase in the price of wheat is attributable to decline in supply possibly due to low production causing the demand to rise. Increased demand, on the other hand, leads to higher prices for wheat. With the new increased price for wheat and assuming that bread manufacturers continue to buy wheat, they will, in turn, increase the price of bread. The following diagram shows the effect on demand and supply of bread as a result of the increased price of wheat. The above diagram shows the effect of a price increase on the quantity of bread supplied. Basically, bread producers are motivated to produce more at an increased price. For example, at  £5, seven pieces of bread are supplied. However, with an increase in the price of wheat which at the same time causes a rise in the price of bread.  The above diagram shows the effect of rising in price on the quantity of brand demanded. Originally, the price of bread is at  £5 and seven pieces are produced. However, with the rise in price to  £6, the demand curve moves backward. This causes a decrease in quantity demanded to five pieces. Butter and margarine are complements of bread. Complements refer to products which are used together with the item in question.