Offer - Term Overview

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An offer is a proposal that is made with the promise to perform or give something. The person who announces an offer is informing her intention to deliver an object or to carry out an action, in general in exchange for something or, at least, with the purpose that the other accepts it. For example: "My boss made me an offer that I could not refuse: double my salary in exchange for accepting regional management", "The offer from the investment group was 25 million dollars for 50% of the player's pass. "

An offer is, on the other hand, a product that is offered for sale at a discounted price. If a product has a regular price of 50 pesos, being on sale it can be sold for 40 pesos or a lower price: "My brother bought a new television that was on sale", "The supermarket has all the cleaning products on sale", "I'm spending more and more since the businesses in my neighborhood don't offer good deals. "

Offer 'Supply' in the economy

For the economy, the supply is made up of the set of goods and services that are offered in the market at a given time and at a specific price. Making a simplification, it can be said that the offer is the amount of products and services that are available to be consumed.

The so-called Law of Supply indicates that the higher the price of a product or service, the greater the supply (producers will have a greater incentive to offer their goods in the market).

In the market economy there are two factors thanks to which it's maintained; these are, supply and demand. The equilibrium of this market is possible thanks to the fact that someone has a good or service that can be useful to another individual and, in turn, the other can offer something that serves them. Through even exchange.

It's said that there is perfect competition when a market is completely competitive. The product is homogeneous and buyers have the tools to decide if the asking price is the real one. In addition, there is free entry and exit and various offers available to customers when there are many small sellers in relation to the market, the product is homogeneous, buyers are well informed, there is free entry and exit of companies and independent decisions, both from the bidders as well as the demanders.

On the contrary, when there is an unequal exchange, it's said that one is facing a market of imperfect competition. Those who offer the product do so as a price-acceptor and not a price-offeror, since they impose the price without accepting counter-offers. In this way, buyers cannot influence the market price.

As long as the demand meets all the preferences of consumers, income and income and prices of goods. The supply is linked to the good in question and those factors that affect productivity. Some of the factors that can determine it are technology, the prices of the productive factors (land, labor, capital) and the price of the good that you want to offer.

It's worth mentioning that there is a concept known as ceteris paribus referring to the table of supply; it responds to the relationship established between the price of a good and the quantities of it that will be offered in a given amount of time.

If the demand table is taken into account, it's possible to know the behavior that consumers will present against a product in a given time; while the supply table will show the behavior of the producers against it.

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