In light of recent and current economic events, discuss the impact of Essay

In light of recent and current economic events, discuss the impact of changing market conditions on the behaviour of firms and consumers - Essay Example In particular, it seeks to illustrate how firms and consumers are affected by these changes in market conditions. The old rules in doing business are different from the rules that are applied in the recent times. In spite of intense competition in many industries, markets have become open to new entrants due to the lessening of barriers, which used to impede free trade in the once confined and protected markets (Wangwe, 1995). According to Albrecht & Sack (2000, p. 5), there are three major developments that have paved the way to the transformation of the business environment. These developments point out to technology, globalization, and power that is vested to some market investors, who hold the majority of the shares in large companies. Technology advancements resulted in a dramatic transformation of communication and culture. Technology has connected the seven continents, which has made transactions simpler and faster in the business environment. Information preparation and dissemination are now made economical by technology that diminished the traditional constraints of communication (Albrecht & Sack, 2000, p. 5). Globalization, on the one hand, enabled the consolidation of the different worldwide markets into one immense marketplace (Albrecht & Sack, 2000). The global market is dominated by big companies that give rise to globalization and fuel stiff competition.  The third development is connected with the two aforementioned developments. Powerful multinational companies are now considered powerful because of how they have conquered many industries due to their advanced technology and extensive participation in globalization. The graph above shows changing market conditions in three markets. Three hypothetical markets were pointed out in the graph. The rising of demand that results in the rising of price and quantity is shown in market A. The rising of supply that results in the rising of quantity and lowering of price is shown in market B.