Identify causes for shifts in supply and demand for the chosen product. There are many different factors that could cause a shift in the supply and demand for soap and at the same time have an influence on price, quantity, and market equilibrium. Changes in pricing for instance maybe related to increase labor and manufacturing cost to produce soap, as well as the economic status of the company. A consumer’s preference often causes shifts relating to convenience, product knowledge, product variety and skin type. Soap companies are educating consumers more by increasing awareness on product profiling, which allows consumers to use soaps that are more beneficial according to skin type. Changes in the growing population of baby-boomers have had an impact on the supply and demands in the soap industry. The soap industry has gained from this particular group of consumer because the increase demands for well-being. Scientific discoveries can also be a factor when more consumers are interested in how natural soap is in comparison to artificial ingredients. With today’s economy the way that it is, consumers may earn less and therefore their budget for certain brands or individualized preferences maybe compromised. Thus all of these factors along with many others can have an impact on the supply and demand of the soap industry.
When considering the market equilibrium of the soap industry the firms must evaluate the cross between supply and demand, thus the market for soap is the equilibrium. This can cause the quantity demand and the supply to be equal. The soap company’s set price will be the equilibrium, and the price and the quantity becomes the equilibrium supply.

References: Hubbard, R. G., & O'Brien, A. P. (2010). Economics (3rd ed.). Retrieved from https://ecampus.phoenix.edu/secure/aapd/cwe/citation_generator/book_04_01.asp

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