Government declares a compulsory festival bonus of Rs.10000/-to all workers working in
the country. Explain the likely impact on the demand for refrigerators in the country?
Answers
In this case, the workers are most likely to buy refrigerators for themselves and their family members with the extra money that they have got as bonus i.e. an amount of Rs 10,000.
Actually, this can be considered to escalate the overall demand for refrigerators at this point of time by considering the demand versus the price range factor.
Workers might be in need of certain essential commodities to buy them or their family, but in general times, they might not be able to afford the requisite amount of sum to buy anything.
However with this sudden bonus, their "Purchasing Power" is definitely going to increase and this will help them to buy certain things of which, refrigerator might be one.
On the other hand, this will also depend on certain other factors like that of necessity or climate of the area. For example if workers and their families do not feel the need to purchase, they might end up not purchasing.
Explanation:
Festival has always an impact on purchasing of household products. People are interested in purchasing electronic goods it may be television to refrigerator.
A bonus of Rs. 10,000 to the workers will increase the demand of electronic products. Demand of the refrigerator under the range of Rs 10,000 will be on higher demand while those who can pay few more can look into Rs 15,000 or EMI purchase can increase purchase of refrigerator to some extent.