1st-Gen iPad

“My baby”-April 2010

The consumers determine the quantity demanded for the good

Producers determine the quantity supplied

The interaction of demand and supply determines the market price of the good

. The price of the resources used to make the product will also determine the sale price of the final product as producers will sell beyond the manufacturing cost to gain profit.

Producers want to maximise profit while minimising cost

cost of production, cost of related resources and state of technology ensure that prices of these normal goods are affordable to a wide market.

price is also influenced by the willingness and ability of the consumers to pay

Consumers have a higher purchasing power due to the end of global recession in June 2009. (Los Angles Times & About.com Guide published on Sept 21, 2010)

HOWEVER…

Substitutes that satisfy the same wants and needs… they are also cheaper.

Samsung Galaxy Tab 10.1Android Tablet

HP TouchPad