WHAT IS LATENT DEMAND AND THE G.I.D.?
The idea of latent demand is relatively delicate. The time period latent sometimes refers to one thing that’s dormant, not observable, or not but realized. Demand is the notion of an financial amount that a goal inhabitants or market requires underneath totally different assumptions of worth, high quality, and distribution, amongst different elements. Latent demand, subsequently, is usually outlined by economists because the business earnings of a market when that market turns into accessible and engaging to serve by competing companies. It is a measure, subsequently, of potential business earnings (K.I.W.) or complete revenues (not revenue) if a market is served in an environment friendly method. It is usually expressed as the entire revenues probably extracted by companies. The “market” is outlined at a given degree within the worth chain. There could be latent demand on the retail degree, on the wholesale degree, the manufacturing degree, and the uncooked supplies degree (the K.I.D. of upper ranges of the worth chain being all the time smaller than the K.I.D. of ranges at decrease ranges of the identical worth chain, assuming all ranges keep minimal profitability).
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