Effects of Technology on supply and Demand

EFFECTS OF TECHNOLOGY ON SUPPLY AND DEMAND

Every Business is run by the Demand and supply of a commodity. Demand and supply forms the basis of any organization.
Demand is basically refers to how much product did buyers want that is also known as quantity.
Supply refers to how much of the product is available for sale to consumer at a specified price at a given point of time.
Today technology has dramatically impacted the market leading to either positive or negative impact on business. It has effected in variety of ways.
Better and advanced technology to produce goods will bring the cost of production down and therefore increased supply of a product. This results in increase of economies of scale and will lead to shift of supply curve. Moreover quality of a product increases that satisfies customer. So, demand of a product also increases. For eg. Mobile sector is growing at a high pace because of lower cost and multiple features which discard their older phone. This increases profit for manufacturer and demand also increases.
On the other hand if technology used is outdated or obsolete then supply will trickle down as a result of increasing cost of Production. This will lead to increase of price of product and demand will decrease which in turn can negatively impact the business.
For eg- Earlier Maruti company was the only Automobile company but lack of technology upgradation, its value was degraded. Therefore it got merged and formed Maruti Suzuki now.