The article ‘iPhone makes Chinese eyes light up', http://www.economist.com/node/21559624, in 28th July 2012 stated that the sales of apple’s product are booming and how responsive is China’s citizen react to it.
As no one has the perfect window for the future, certain trends such as rise in price of goods and services such as cars, food, or houses definitely exist along the time. Often the decisions that consumers made whether to consume such goods or services are depend on the change in price of goods and services. Based on the article ‘Apple in China, iPhones make Chinese eyes light up’, it could further strengthen the point of saying that it is important for everyone to understand the market situation and deal with the economics problems wisely in order to maximize consumers’ benefit. In addition, this article has covered the elasticities of demand such as price elasticity of demand, income elasticity of demand and also cross elasticity of demand in microeconomics, by providing data, results and graphs, giving a clearer view for readers to understand how do markets actually work with the influence of available factors and variables.
First and foremost, it is true to say that Apple brings huge impact to the economy by providing its services such as the introducing of smart phones. According to the article, Apple achieved excellent results, earning high revenues due to the impressive sales. This can be explained that there is high quantity demand from consumers. It seems that consumers in China have high willingness and ability to pay for Apple’s product, even though the gadgets’ price is relatively high for a phone. However, Apple’s products such as iPhone, indeed making consumers’ lives way easier. For example, consumers still able to update themselves with the access to internet through the smart phone. It can be deduced that Apple’s product is high price elastic in demand. This is because a smallest possible fall in price of iPhone would lead to an...