Shortage – this is an urgent need for an item that you do not have in stock. This situation leads to easily calculated costs. And, if for resale companies this results in a loss from lost profits, then for manufacturing companies it can cause downtime of capacity, which can lead to significant losses. O greater losses. In addition, in both types of companies, a situation of regular significant deficit can lead to the loss of some customers!.. But, despite all these possible negative consequences of the deficit, many companies not only do not manage the deficit, but do not even consider it!..

How to obtain deficit data.

There are four most common options for obtaining shortage data from companies.

1. Implementation of a pre-order document, when employees placing an order do not see the remaining stock, but fill in the data about what they need. Based on this document, an invoice or invoice for the movement is built, which includes all the remaining quantities from the pre-order. And in parallel, a primary shortage document is generated, which includes all quantities from the pre-order that were not available in the warehouse balances.

• Pros. The generation of deficit documents becomes automatic and, as it were, objective - it is difficult to argue that there was no shortage.
• Minuses. There may be: insufficient data about the shortage, when an employee who already knows about the lack of a position will not waste time to add it to new pre-orders; as well as excessive data on shortages, when, in the hope that balances will appear in the form of a pre-order, the same need will be placed. In addition, the opportunity to interactively notify consumers about the absence of the item they need is lost, so that they can more conveniently select the items they need.
• It is best to use such a system when calculating the deficit of a distribution center serving branches or stores that send out supply requests no more than once a week.

• Pros. No automatic overestimation or underestimation of deficit data.
• Minuses. Often: either the absence of any documents at all - if employees are not in any way interested in entering them; or vice versa - the special introduction of false documents, if the employee has some interest in this.
• It is best to use such a system in a situation with 100% supply of demand. In this case, only information about the demand for products that are not generally represented in the company’s assortment will be entered into such primary shortage documents. Based on this information, it will be possible to determine what other assortment is in regular demand, which means it needs to be created.

• Pros. Automatic calculation of deficits. No costs for unproductive entry of primary shortage documents - either directly or through pre-orders. It is more difficult for interested employees to falsify information about shortages.
• Minuses. The complexity of the mathematical models used to correctly estimate deficits. The possibility of a technical or logical error that may lead to erroneous results.
• Such a system can be used wherever it is economically feasible. At the same time, the implementation of such a calculation is not so expensive, for example, a module ready for 1C, which will allow you to automatically calculate the deficit, and even based on the data obtained, build a demand forecast for the future - art. O it on http://prognoz-prodaj.ru/ only 37,760 rubles.

• Pros. It is possible to collect all the advantages of the above methods and neutralize the disadvantages by combining the third model with the first or second.
• Minuses. Such a synthesis is not at all trivial, as it may seem at first, since for each case of different values: calculated and based on primary documents, it is necessary to think through a system for deciding which of them or which compilation of them should be taken into account.

So what is the shortage?

If you just stopped in bewilderment at the word “calculation” with a question about four methods of what we considered before, then I’ll explain with an example. “Is a deficit of a million rubles a lot?” – For some companies, this is more than their turnover, and against the backdrop of tens of billions of rubles, such a deficit is lost in statistical error. That is, in order to understand the criticality of the situation, we must not operate with absolute values, which we will still need to financially justify additional spending to combat the deficit. To assess the deficit and its dynamics, one must use relative values ​​- that is, the same deficit, but expressed as a percentage. And here the question arises, as a percentage of what? And here too there are options: in the concept ACE – Total Inventory Management – ​​these options are usually called shortage types or orders.

1. The first type is the simplest: when we count the number of stock shortage indicators - deletions – that is, incomplete shipments from the warehouse due to the lack of the required product there, after which we divide this quantity by the total number of applications received at the warehouse. However, despite the simplicity of this technique, they try not to use it. Firstly, in this case, the situations when we shipped for a million and crossed out for a thousand, and vice versa, when we crossed out for a million and shipped for a thousand, are no different from each other. Secondly, employees have the opportunity to fictitiously reduce the shortage by splitting requests into several documents for “different” warehouse areas, which increases the number of “successfully” completed shipments. Although a variation of this methodology helps to prevent such frauds, based on calculating the deficit not by the number of documents, but based on the number of crossed out lines in these documents in relation to the total number of lines in all applications. This calculation method is used in areas with similar products and approximately the same order volume from internal or external customers.
2. The second type is the most common. He gained such popularity due to the fact that he highlights the deficit from the most important point of view for senior management and company owners - financial! Namely, it gives an estimate of the percentage of the company’s revenue lost due to a deficit. The calculation is carried out using the following formula:

percentage of deficit = amount of deficit / (amount of deficit + amount of sales) , Where:

the amount of the deficit is obtained in one of the four ways discussed above.

1. The third type is a combination of the first two. We estimate the amount of applications that are not fully secured and divide them by the amount of all applications. This modification of deficit calculation is used when calculating losses on deliveries to retail chains, which impose serious fines for short deliveries. For the same reason, this modification is used in some industries - in this case, the penalty is implicit, but in case of downtime of production facilities due to the lack of a single part, this is completely justified.

Fighting shortages.

After the data on the deficit has been collected and summarized in the required formula, the question usually always arises of how to make it smaller. It is possible, of course, to oblige an employee to pay with his salary for a deficit exceeding certain standards, but as practice shows, in such cases the enterprise loses much more than the employee. And stockpiling more and more of everything, leading us away from deficits, pushes us to the other extreme, which is fraught with write-offs due to expiration dates, long-term freezing of funds, illiquid assets and increased storage costs. In general, it is always better to work with the cause rather than the effect; the deficiency itself is always an unpleasant consequence, so we will formulate solutions specifically for the causes of the deficiency, which are usually the following.

Fictitious reserves. You have a small quantity left in your warehouse for some item, but in principle, it should be enough until the next delivery arrives. And suddenly, one of the smart employees reserves the entire remaining quantity for himself, so that later in any case he will not experience a shortage of this item, although he may not need it until the very moment the next delivery arrives. At the same time, all other employees are forced to experience a real shortage if they need this position, since they will not be able to take it from the warehouse - it is reserved.

Solution: introducing responsibility for employees who do not use their reserves for a long time and automatic removal from the reserve if it is not implemented after a certain time.

Major need. You have stock for another two weeks, the next order has already been placed and will arrive at the warehouse in 3-4 days. There seems to be no reason to panic, but suddenly one of the internal or external clients has an urgent need for a large volume of this position, and he buys up the entire stock for it.

Solution: try to ship large volumes - under an additional request-order from the supplier for this client. You can even give external customers an additional discount for pre-ordering - in any case, it will be cheaper for the company than storing such a volume in a warehouse for a long time, and then being left with a shortage. If the client wants to receive his entire large order here and now, then communicate with him regarding gradual delivery as these products arrive at your warehouse. Most likely, technological processes will still not allow him to use the entire purchased volume for the position, and he is doing this only to save on delivery and get the maximum discount. Therefore, you can fix prices and promise free delivery, the main thing is to agree that right now there will be only a partial shipment, and the second part will be delivered to him free of charge after the next shipment arrives.

Lack of trusted suppliers. Often the cause of a large, protracted shortage is the bankruptcy of the main supplier, who suddenly turns out to be the one and only. A frantic search for a replacement, hasty negotiations, and the first deliveries, which often turn out to be the “first pancake,” do not improve the situation with a warehouse that has already been empty for a long time. A delay in the arrival of a specific delivery to the warehouse may not be such a terrible situation, but can also lead to a significant shortage. The reason may be: long customs, or loss on the road, or something else - in any case, the company needs a nearby supplier for each item, who, even if not at the best prices, will provide it with everything necessary until the main delivery arrives from main supplier.

Solution: creating a register of verified suppliers, in which for each purchased product group the following must be entered:

· main supplier;

· a supplier to replace the main one if something happens to him;

· supplier to intercept if there is a delay in delivery from the main supplier.

This interception provider can be any company located nearby, even a direct competitor of the company.

Unrealistic delivery times. You can estimate the shortage - not only for the company as a whole or for specific items, but also in the context of suppliers, branches, and employees who are responsible for the supply of these items. And if a shortage is regularly detected for one of the suppliers, then, most likely, the order to it is placed too late. As a result, by the time the goods arrive, there is always a shortage.

Solution: calculation of real delivery times based on the difference between the date the order is placed to the supplier and the date the product is delivered to the warehouse in order to start the order based on this real value.

Errors during purchasing. One way or another, all people make mistakes, and purchasing department employees are no exception. As they say, if “every doctor has his own cemetery,” then every supplier has his own “extra zero.” From a shortage point of view, a mistake could be an inappropriately small order, or a mixed-up item that will never need that much, and for the item that was not purchased as a result, there will be a severe shortage.

Solution: regulation and automation of the supply business process. In addition to the obvious benefit from reducing the number of errors, and hence the shortages arising from them, automation allows you to speed up the execution of many works and bring the solution of many logistics problems to a qualitatively new level of accuracy.

Lack of money. A common situation is when a successful, rapidly growing company constantly experiences a shortage of money, and therefore products that it cannot buy.

Solution: Only clear financial planning can help, at least for strategic decisions about a significant increase in the range or large expenses that will not quickly return to the company. The goal is to prevent gaps in the company’s liquidity, which can lead to a deficit and, as a result, a “strain of growth”, which often ends in the bankruptcy of such a successful company.

Conclusion.

Deficit is not so difficult to calculate, at least to a first approximation. The effect of its reduction is felt instantly in the company’s revenue. Therefore, enterprises that have begun to clearly consider the deficit and are trying to manage it are already less likely to experience shortages in products and earn more in the same market than their competitors who treat the deficit as a necessary evil.

However, I don’t want anyone to be left with the feeling after reading this article that scarcity is always a bad thing. For example, in the company where I currently work: http://vkusvill.ru/ – a deficit of 6% is initially included in the inventory management model. We are forced to do this, since all our dairy products are completely natural, and their shelf life is usually less than a week, and often only 2-3 days. In this case, an attempt to ensure consumption at 100% leads to serious write-offs of expensive products, which can reach up to 30% of sales volume! Therefore, it is cheaper for us to deliberately maintain the deficit at the level of 6% than to constantly write off such volumes at a loss.

Valery Razgulyaev

Reprinting and reposting of the article along with this text, indication of the author, and links to the original

The table shows the scale of demand and supply of goods
|P (thousand rubles/unit) |Qp (thousand units per year) |Qs (thousand units per year) |
|1 |25 |5 |
|2 |20 |10 |
|3 |15 |15 |
|4 |10 |20 |
|5 |5 |25 |
1) Determine the equilibrium sales volume and price?
2) Determine the volume of demand for the product and the volume of supply of the product at price P = 2 thousand rubles. per unit?
3) What situation arises in the product market at a price of P = 2 thousand rubles. per unit (shortage or overstocking)?
4) Determine the volume of deficit or surplus in the market at a price of P = 2 thousand rubles. per unit?
5) What will sellers do if they discover that there is a shortage (surplus) in the market?

Answers:

Solution: 1) analytically, based on the initial data, we determine the functions of supply and demand. Qp=a-bP - demand function (based on initial data - linear function). Then: 25=a-b; 20=a-2b; Let's solve the system of equations: a=25+b; 20=25+b-2b; b=5; a=30, then the demand function has the form: Qp=30-5P. Qs=a+bP – supply function (based on initial data – linear function). 5=a+b; 10=a+2b; a=5-b; 10=5-b+2b; b=5; a=0, then the supply function has the form: Qs=5P. Let's determine the equilibrium price: 30-5P=5P; Then P=3 is the equilibrium price. Let's determine the equilibrium sales volume: Qequal=5*3=15 pcs. – equilibrium sales volume. 2) Let us determine the volume of demand for the product and the volume of supply of the product at a price of P = 2 thousand rubles. per unit Qp=30-5P=30-5*2=20 thousand units. per year – the volume of demand for the product; Qs=5*2=10 thousand units. per year - the volume of supply for the product. 3) What situation arises in the product market at a price of P = 2 thousand rubles. per unit (shortage or overstocking)? Since at P = 2 thousand rubles. per unit the volume of demand for the product is 20 thousand units. per year, and the supply volume is 10 thousand units. per year, there will be a shortage in the market. 4) The volume of deficit in the market at a price of P = 2 thousand rubles. per unit will be 10 thousand units. in year. 5) What will sellers do if they discover that there is a shortage (surplus) in the market? If there is a shortage of goods in the market, then sellers will accordingly raise the price of the goods; if there is a surplus, then the price will decrease.

A price of 100 below the equilibrium price (P = 200) means a shortage of goods. Let us subtract from the volume of demand at this price 800 the volume of supply of 400. The shortage is that there are not enough refrigerators for buyers). Manufacturers will raise prices to avoid shortages.

A price of 400 above the equilibrium price means an excess of goods. Let us subtract from the volume of supply 1300 the volume of demand 500. The surplus of goods is 800 (manufacturers are ready to sell 800 more refrigerators than buyers want and can buy). Manufacturers will reduce the price to the equilibrium price in order to sell all their products.

3. Let’s construct a graph of market equilibrium for refrigerators per day using points from the scale. For the demand curve, take the points: P1 = 100, Q 1 = 800; P2 = 400, Q 2 = 500.

For the supply curve: P1 = 100, Q 1 = 400; P2 = 400, Q 2 = 1300.

Figure 2.4. Market Equilibrium Graph

Answer. Equilibrium price Pe = 200, equilibrium sales volume Qe = 700. At a price of 100, the deficit is 400 refrigerators, at a price of 400 the surplus is 800 refrigerators.

Task 2.Draw a market equilibrium graph, determine the equilibrium price and sales volume. Determine and calculate the shortage and surplus of goods at prices: 5, 15, 20.

Demand function: QD = 50 – 2 P.

Suggestion function: QS = 5 + P .

Solution:

Table 2.5

Supply and Demand Scale

Rice. 2.5. Market Equilibrium Graph

Answer. The equilibrium price is 15, the equilibrium sales volume is 20. At a price of 5 rubles: the deficit is 30. At a price of 15 rubles: market equilibrium. At a price of 20 rubles: excess goods 15.

2.2. Elasticity of supply and demand

Having studied the concepts of supply and demand, market equilibrium and equilibrium price, we will become familiar with elasticity. It is not enough for an entrepreneur to be able to determine the equilibrium price to achieve market equilibrium. The market situation is unstable, business activity is influenced by environmental factors: suppliers, buyers, competitors, tax and monetary policies of the state, etc. Many factors lead to price changes - lowering or increasing.

Therefore, an entrepreneur needs to know how supply and demand will change when prices for his products change. Even before opening a company, the entrepreneur determines what elasticity he will work with the product in order to know what price manipulations he can carry out to increase sales volumes, and which ones will lead to a drop in supply and demand.

2.2.1. Elasticity of demand

Basic Concepts

Elasticity of demand – shows how much the volume of demand for a product will change in response to changes in factors such as price, consumer income, and the price of another product.

Price elasticity of demand – shows how much the quantity demanded changes when the price of a product changes.

A good may have elastic demand, inelastic demand, or unit elastic demand. To determine the type of elasticity, we use two indicators:

1. Elasticity coefficient.

2. The total revenue of the seller.

1. Price elasticity of demand (ED)– shows the relative change in the volume of demand with a relative change in price.

To calculate we use the formula:

where P1 is the initial price of the product,

P2 – new price,

Q 1 – initial volume of demand

Q2 – new volume of demand.

The coefficient of price elasticity of demand shows by what percentage the quantity demanded will change when the price changes by 1%.

There are three types of elasticity of demand:

· easily replaceable goods (meat, fruits).

Products with price inelastic demand:

· basic necessities (medicines, shoes, electricity);

· goods whose cost is insignificant for the family budget (pencils, toothbrushes);

· hard-to-replace goods (bread, light bulbs, gasoline).

Factors of price elasticity of demand.

1. Availability of substitute and complementary goods on the market. The more close substitutes a product has, the higher its elasticity of demand and vice versa. If a good is a less significant complement to an important good, then the demand for it is usually inelastic.

2. The time frame within which the purchase decision is made. Over short periods of time, demand is less elastic than over long periods.

2. Seller's total revenue TR we calculate using the formula:

TR = P x Q , (2.9)

where P is the price of the product,

Q is the quantity of goods at this price.

Examples of problem solving

Task 1. When the price of milk increases from 30 to 35 rubles. for 1 liter in the store, the volume of demand for it decreased from 100 to 98 liters. Determine the type of elasticity of demand for milk, the change in the total revenue of the seller.

Solution

1. Let's calculate .

P1 = 30 rubles, P2 = 35 rubles.

Q 1 = 100 l, Q 2 = 98 l.

|ED | = 0.13%< 1% – объём спроса сократился в меньшей степени (на 0,13%), чем выросла цена (на 1%), поэтому молоко – товар неэластичного спроса.

2. Let’s determine how the seller’s revenue will change if the price of milk increases from 30 to 35 rubles. per liter

Let's calculate the revenue at the initial price of 30 rubles.

TR 1 = P 1 x Q 1

TR 1 = 30 x 100 = 3000 rub.

Let's calculate the seller's revenue at the new price of 35 rubles.

TR 2 = P 2 x Q 2

TR 2 = 35 x 98 = 3430 rub.

∆TR = TR 2 – TR 1

∆TR = 3430 – 3000 = 430 rub.

Answer. Since milk |ED |< 1%, то спрос неэластичен, то есть он слабо реагирует на изменение цены. При повышении цены на молоко объём спроса сократился незначительно. Поэтому выручка продавца, несмотря на повышение цены, выросла на 430 руб.

Task 2. When the price of apples increases from 65 to 90 rubles. for 1 kg in the store, the volume of demand for it decreased from 30 to 18 kg. Determine the type of elasticity of demand for apples, the change in the seller’s total revenue.

Solution

1. Let's calculate coefficient of price elasticity of demand.

P1 = 65 rubles, P2 = 90 rubles.

Q 1 = 30 kg, Q 2 = 18 kg.

|ED | = 1.55% > 1% – the volume of demand decreased to a greater extent (by 1.55%) than the price increased (by 1%), therefore apples are a product of elastic demand.

2. Let’s determine how the seller’s revenue will change if the price of apples increases from 65 to 90 rubles. per kg.

Let's calculate the revenue at the initial price of 65 rubles.

TR 1 = P 1 x Q 1

TR 1 = 65 x 30 = 1950 rub.

Let's calculate the seller's revenue at the new price of 90 rubles.

TR 2 = P 2 x Q 2

TR 2 = 90 x 18 = 1620 rub.

Let's calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR = 1620 – 1950 = –330 rub.

Answer. Since on apples |ED | > 1%, then demand is elastic, that is, it is sensitive to price changes. When the price of milk increases, the quantity demanded decreases more than the price increases. Therefore, the seller’s revenue decreased by 330 rubles.

Task 3. When the price of umbrellas increases from 500 to 1000 rubles. for 1 umbrella in the store
the volume of demand for them decreased from 80 to 40 pcs. Determine the type of elasticity of demand, the change in the seller's total revenue.

Solution:

1. Let's calculate price elasticity of demand.

P1 = 500 rub., P2 = 1000 rub.

Q 1 = 80 pcs., Q 2 = 40 pcs.

|ED | = 1% = 1% – the volume of demand decreased to the same extent as the price increased (by 1%), therefore the umbrella is a product of demand with unit elasticity.

2. Determine how the seller’s revenue will change.

TR 1 = P 1 x Q 1

TR 1 = 500 x 80 = 40,000 rub.

Let's calculate the seller's revenue at the new price of 1000 rubles.

TR 2 = P 2 x Q 2

TR 2 = 1000 x 40 = 40,000 rub.

Let's calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆ TR = 0 rub.

Answer. Since on the umbrella |ED | = 1%, then the demand of unit elasticity, that is, the volume of demand, changes to the same extent as the price. Therefore, the seller's revenue did not change after the price change.

2.2.2. Elasticity of supply

Basic Concepts

Elasticity of supply – the ability of supply or its quantity to change as a result of changes in market prices.

Depending on the level of the supply elasticity coefficient, the following types of elasticity are distinguished.

1. If Ed>1, then the offer elastic, it is sensitive to changes in the price situation, even a slight change in price leads to a significant change in sales volumes; When the price falls, the volume of sales decreases significantly, and when the price increases, the volume of sales increases.

2. If Ed < 1, то предложение inelastic, it reacts poorly to changes in the price situation; even a significant change in price does not lead to significant changes in sales volumes. The manufacturer cannot benefit from a favorable market situation, and if the price decreases, it suffers losses.

3. If Ed= 1, then the sentence unit elasticity, changes in supply and price occur in the same proportion, the income and profit of the manufacturer remain the same.

Price elasticity coefficient of supply(ES) shows the relative change in quantity supplied with a relative change in price.

The calculation formula is similar to the formula for calculating ED.

The elasticity of supply depends on many factors:

1. Long-term storage capabilities and storage costs. A product that cannot be stored for a long time or is expensive to store has a low elasticity of supply.

2. Specifics of the production process. In the case where the producer of a good can either increase its output when the price rises, or produce another good when the price decreases, the supply of this good will be elastic.

3. Time factor. The manufacturer cannot quickly respond to price changes, since it takes a certain amount of time to hire additional workers, purchase means of production (when it is necessary to increase output), or to lay off some workers, to pay off a bank loan (when it is necessary to reduce output). In the short term, supply can be increased by an increase in demand (price) only through more intensive use of existing production capacities. However, such intensity can only increase market supply by a relatively small amount. Consequently, in the short run, supply is low price elastic. In the long run, entrepreneurs can increase their production capacity by expanding existing capabilities and by firms building new enterprises. Thus, in the long run, the price elasticity of supply is quite significant.

4. Prices of other goods, including resources. In this case we are talking about cross elasticity of supply.

5. The degree of achieved use of resources: labor, material, natural. If these resources are not available, then the supply response to elasticity is very small.

Examples of problem solving

Task 1. When the price of yoghurts increases from 15 to 25 rubles. for 1 piece in the store, the volume of supply for them increased from 100 to 110 pcs. Determine the type of supply elasticity, the change in the seller's total revenue.

Solution:

1. Let's calculate coefficient of price elasticity of supply.

P1 = 15 rubles, P2 = 25 rubles.

Q 1 = 100 pcs., Q 2 = 110 pcs.

ES = 0.19%< 1% – объём предложения увеличился в меньшей степени (на 0,19%) чем выросла цена (на 1%), поэтому йогурт – товар неэластичного предложения.

2. Let’s determine how the seller’s revenue will change if the price of yogurt increases from 15 to 25 rubles. for 1 piece

Let's calculate the revenue at the initial price of 15 rubles.

TR 1 = P 1 x Q 1

TR 1 = 15 x 100 = 1500 rub.

Let's calculate the seller's revenue at the new price of 25 rubles.

TR 2 = P 2 x Q 2

TR 2 = 25 x 110 = 2750 rub.

Let's calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR = 2750 – 1500 = 1250 rub.

Answer. Since on yogurt ES< 1%, то предложение неэластично, то есть оно слабо реагирует на изменение цены. Выручка продавца выросла на 1250 руб.

Task 2. When the price of shirts is reduced from 500 to 450 rubles. for 1 piece in the shop
the volume of supply for them decreased from 70 to 50 pieces. Determine the type of supply elasticity, the change in the seller's total revenue.

Solution:

1. Let's calculate price elasticity of supply.

P1 = 500 rub., P2 = 450 rub.

Q 1 = 70 pcs., Q 2 = 50 pcs.

ES = 3.17% > 1% – the supply volume decreased to a greater extent (by 3.17%) than the price decreased (by 1%), therefore shirts are a product of elastic supply.

2. Let’s determine how the seller’s revenue will change if the price of shirts decreases from 500 to 450 rubles. for 1 piece

Let's calculate the revenue at the initial price of 500 rubles.

TR 1 = P 1 x Q 1

TR 1 = 500 x 70 = 35,000 rub.

Let's calculate the seller's revenue at the new price of 450 rubles.

TR 2 = P 2 x Q 2

TR 2 = 450 x 50 = 22,500 rub.

Let's calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR = 22,500 – 35,000 = – 12,500 rub.

Answer. Since the shirt has ED > 1%, supply is elastic, that is, it is sensitive to price changes. The seller's revenue decreased significantly - by 12,500 rubles. It is not profitable for a manufacturer to reduce prices for goods of elastic demand due to a reduction in revenue.

3. PRODUCTION COSTS

In a market economy, the goal of producers is to maximize profits. Therefore, entrepreneurs choose which product to produce, focusing on consumer demand and the possibility of making a profit. To increase profits, enterprises use new technologies and reduce costs.

Production volumes are affected by costs. If they increase, then the company reduces production volumes. If costs are reduced, supply increases.

Basic Concepts

Costs- these are the costs incurred by the company in organizing the production and marketing of products.

Classification of costs

1. Fixed costs (FC)- costs that do not directly depend on the volume of output and which the company incurs even if production stops completely.

2. Variable costs (VC)- costs that directly depend on the volume of output and include costs for the purchase of raw materials, energy, production services, etc.

3. General costs (TC)– the sum of fixed and variable costs:

TC = FC + VC(3.1)

4. Average fixed costs (AFC)– fixed costs per unit of production, which can be calculated using the formula:

5. Average variable costs (AVC)– variable costs:

6. Average total costs– total costs per unit of production:

AC =AFC+AVC(3.4)

Economies of scale

Economies of scale– changes in production costs and business indicators due to an increase in production volume .

Depending on the character they distinguish three economies of scale:

1. Positive

2. Negative

3. Permanent.

Positive effect– with an increase in production volumes, production costs decrease.

Negative effect– as production volumes increase, costs rise.

The equilibrium price is the price at which the quantity demanded in the market is equal to the quantity supplied. Expressed as Qd(P) = Qs(P) (see basic market parameters).

Purpose of the service. This online calculator is aimed at solving and checking the following problems:

1. Equilibrium parameters of a given market (determining the equilibrium price and equilibrium volume);
2. Coefficients of direct elasticity of demand and supply at the equilibrium point;
3. Consumer and seller surplus, net social gain;
4. The government introduced a commodity subsidy for each unit of goods sold in the amount of N rubles;
5. The amount of subsidies allocated from the state budget;
6. The government introduced a commodity tax on each unit of goods sold in the amount of N rubles;
7. Describe the consequences of the government’s decision to fix the price N above (below) the equilibrium price.

Instructions. Enter the supply and demand equations. The resulting solution is saved in a Word file (see example of finding the equilibrium price). A graphical solution to the problem is also presented. Qd - demand function, Qs - supply function

Example. The demand function for this product is Qd=200–5P, the supply function is Qs=50+P.

1. Determine the equilibrium price and equilibrium sales volume.
2. Let's assume that the city administration decided to set a fixed price at: a) 20 den. units per piece, b) 30 den. units a piece.
3. Analyze the results obtained. How will this affect the behavior of consumers and producers? Present the solution graphically and analytically.

Solution.
Let's find the parameters of equilibrium in the market.
Demand function: Qd = 200 -5P.
Supply function: Qs = 50 + P.
1. Equilibrium parameters of this market.
At equilibrium Qd = Qs
200 -5P = 50 + P
6P = 150
P equals = 25 rub. - equilibrium price.
Q equals = 75 units. - equilibrium volume.
W = P Q = 1875 rub. - seller's income.

Consumer surplus measures how much better off individuals are on average, on average.
Consumer surplus(or gain) is the difference between the maximum price that he is willing to pay for the product and the one that he actually pays. If we add up the surpluses of all consumers who purchase a given product, we get the size of the total surplus.
Producer surplus(profit) - this is the difference between the market price and the minimum price for which producers are willing to sell their goods.
Seller's surplus (P s P 0 E): (P equal - Ps)Q equal / 2 = (25 - (-50))75 / 2 = 2812.5 rub.
Buyer's surplus (P d P 0 E): (Pd - P equal)Q equal / 2 = (40 - 25)75 /2 = 562.5 rub.
Net social benefit: 2812.5 + 562.5 = 3375
Knowledge of surpluses is widely used in practice, for example, when distributing the tax burden or subsidizing industries and firms.

2) Suppose that the city administration decided to set a fixed price at 20 den. units a piece
P fixed = 20 rub.
Quantity demanded: Qd = 200 -5 20 = 100.
Quantity supplied: Qs = 50 + 1 20 = 70.
After fixing the price, the quantity demanded decreased by 25 units. (75 - 100), and the deficit of manufacturers decreased by 5 units. (70 - 75). There is a shortage of goods on the market of 30 items. (70 - 100).


Let's assume that the city administration decided to set a fixed price at 30 den. units a piece.
P fixed = 30 rub.
Quantity demanded: Qd = 200 -5 30 = 50.
Quantity supplied: Qs = 50 + 1 30 = 80.
After fixing the price, the volume of demand increased by 25 units. (75 - 50), and producer surplus increased by 5 units. (80 - 75). There is a surplus of goods in the market of 30 pcs. (80 - 50).

Basic Concepts

Equilibrium price- the price that develops in the market as a result of the interaction of supply and demand, at which the volume of purchases that buyers are ready to make will be equal to the volume of sales of goods that suits suppliers.

Market equilibrium is a market condition in which the volume of demand is equal to the volume of supply.

QD = Qs = Qe– equilibrium volume(2.5)

P D = Ps = Pe– equilibrium price(2.6)

Example. Let's combine the previously constructed demand and supply graphs (Fig. 2.3).

Functions: demand Q D = 45 – 2P, supply: Qs = 5 + 2P

Table 2.3

Supply and Demand Scale

Figure 2.3. Market Equilibrium Graph

The equilibrium price can be determined using functions. From the definition of market equilibrium, we know that at the equilibrium price, the volume of demand is equal to the volume of supply.

Let us equate the functions of supply and demand:

QD = Qs (2.7)

45 – 2P = 5 + 2P

From here we find out the equilibrium price: Pe = 10. Substituting it into any of the functions, we find the equilibrium sales volume Qe = 25 (45 – 2 x 10 = 25 or 5 + 2 x 10 = 25).

We compare the obtained indicators with the graph and make sure that we have correctly determined both the equilibrium price and the equilibrium sales volume.

Excess of goods– a state in the market in which the price exceeds the equilibrium price. Manufacturers, seeing undistributed products, will reduce prices to equilibrium.

Product shortage– the price is below the equilibrium price. Producers will begin to increase the price until the volume of demand is equal to the volume of supply.

Let's calculate the shortage and excess of goods in our example at prices of 5, 10, 15.

1. On the scale, let’s look at the volume of demand at a price of 5 – 35, the volume of supply – 15. Since 5 is a price below the equilibrium price (below Pe = 10), there is a shortage of goods at this price. It is necessary to determine how much demand exceeds supply. Let’s do the math: subtract the volume of supply from the volume of demand: 35 – 15 = 20. So, at a price of 5, the shortage of goods is 20.

2. At a price of 10, the volume of demand is equal to the volume of supply, therefore, at this price there is market equilibrium.

3. At a price of 15, supply exceeds demand - there is an excess of goods. Let's do the math: from the supply volume of 35, subtract the demand volume of 15. At a price of 15, the surplus of goods is equal to 20.

We will check the obtained data on a chart at the same prices.

Example of problem solving

Task 1. Construct a graph of market equilibrium for refrigerators in a store per day. Determine the equilibrium price (Pe) and the equilibrium sales volume (Qe). Determine the presence of shortages and surpluses of goods at prices of 100 and 400 rubles.

1. Demand function: Q D = 900 – R.

2. Supply function: Q S = 100 + 3P.

Solution:

1. Using functions, we determine the equilibrium price and equilibrium sales volume. To do this, let's equate the functions.

900 – P = 100 + 3P, 900 – 100 = 3P + P, 800 = 4P, Pe = 200 – equilibrium price.

Let us substitute the resulting equilibrium price into any of the functions: Q D = 900 – 200 = 700 or Q S = 100 + 3 x 200 = 700. Equilibrium sales volume Qе = 700.

2. Let's build a scale.

Table 2.4

Supply and Demand Scale

Using a scale, we determine the surplus and shortage of goods at prices of 100 and 400.

A price of 100 below the equilibrium price (P = 200) means a shortage of goods. Let us subtract from the volume of demand at this price 800 the volume of supply of 400. The shortage is 400 (400 refrigerators are not enough for buyers). Manufacturers will raise prices to avoid shortages.

A price of 400 above the equilibrium price means an excess of goods. Let us subtract from the volume of supply 1300 the volume of demand 500. The surplus of goods is 800 (manufacturers are ready to sell 800 more refrigerators than buyers want and can buy). Manufacturers will reduce the price to the equilibrium price in order to sell all their products.

3. Let’s construct a graph of market equilibrium for refrigerators per day using points from the scale. For the demand curve, take the points: P 1 = 100, Q 1 = 800; P 2 = 400, Q 2 = 500.

For the supply curve: P 1 = 100, Q 1 = 400; P 2 = 400, Q 2 = 1300.

Figure 2.4. Market Equilibrium Graph

Answer. Equilibrium price Pe = 200, equilibrium sales volume Qe = 700. At a price of 100, the deficit is 400 refrigerators, at a price of 400 the surplus is 800 refrigerators.

Task 2. Draw a market equilibrium graph, determine the equilibrium price and sales volume. Determine and calculate the shortage and surplus of goods at prices: 5, 15, 20.

Demand function: Q D = 50 – 2P.

Supply function: Q S = 5 + P.

Solution:

Table 2.5

Supply and Demand Scale

Rice. 2.5. Market Equilibrium Graph

Answer. The equilibrium price is 15, the equilibrium sales volume is 20. At a price of 5 rubles: the deficit is 30. At a price of 15 rubles: market equilibrium. At a price of 20 rubles: excess goods 15.