24 Aug Today we are going to discuss on Demand Function and how imp

Today we are going to discuss on Demand Function and how important is it in determining the price of a product which you are going to release in the market. In order to release a new product into the market, one should have a good knowledge on the existing market conditions and know all the competitors available in the market. Demand Function helps a firm to gain knowledge on the existing market conditions. Let us now know what this Demand Function is. “Demand function is a mathematical equation which expresses the demand of a product or service as a function of the its price and other factors such as the prices of the substitutes and complementary goods, income, etc.”In today’s discussion let us consider that we are dealing with car manufacturing. As most of us are aware of the current situation, let me discuss in detail how this situation impacting the car manufacturing company. Due to this pandemic situation, there are lot of things which is affecting the car companies. As most of the people are willing to stay at home, the demand for new technology cars are decreasing a lot. 2020 is the year where most of the car companies are trying to bring in their new models with good technology built in them. Also, there are few car companies whose vision for 2020 is to introduce fully autonomous driving cars. Due the current situation they are not able to introduce them into the market. There are many reasons impacting the failure of the car companies in introducing new vehicles, as most of the people are being impacted by the pandemic situation. There are lot of job impacts which is impacting the economy of the country. Also, some of them are being hospitalized due the situation. Also, the company is trying to bring in the fully autonomous driving car in to the market starting at a price range, but due the current situation, many people cannot afford the car, so they need to postpone their product release. There is no guarantee that the situation will be settled down soon, So the car companies needs to give proper explanation to their customers/Stake-holders why they cannot introduce new products into the market.Based on my opinion the Elasticity for this product is inelastic. The reason for this is that no car manufacturing company can go and lower the prices and sell their cars at lower prices. Also, there is no mandatory need for cars during this time. Nobody is looking to buy in a new car.