Economic Concepts in ITC Ltd.

                                        ITC LTD

ITC Ltd. is one of the fast moving companies which deals in consumer goods. We can also show how simple concept of economics applies in ITC Ltd. which deals in different types of product such as Fiama Devils, Aashirvaad, Sun feast, Vivel, Engage, Classmate etc.

ECONOMIES OF SCOPE :-

ITC Ltd. deals in various field of household or consumer product that leads to cost saving because product shares common input and diversification of product such as Fiama Devils, Aashirvaad, Sunfeast, Vivel, Engage, Classmate  etc. Here we can easily say that economies of scope applies in this company.

PEOPLE FACE TRADE-OFF :-

There are many examples of product under ITC Ltd. between which people can  face trade-off such as Aashirvaad, Sunfeast, Vivel, Engage, Classmate , Paper Boat, Colour Crew  etc. Here we can say that people have to give up .

PEOPLE RESPOND TO INCENTIVES :-

ITC Ltd. offers that buys products of  Rs.500 and Rs.200 product free and many a time discount is also offered by them of some of the product such as up-to 50% off on Vivel, Flat 30% off on Pond's cream and people start buying product more rapidly. Here, we can say people respond to incentives applies in this company.

TASTE AND PREFERENCES :-

Demand of products under ITC Ltd. is depend upon taste and preferences of people . All consumers have different taste and preference  according to their up bringing , religion and believes. Lets take Marwadis , they are mostly pure vegetarian so they might not use Vivel because it contains egg into it.

SUBSTITUTE GOODS :-

Price of substitute good also influence the demand of  products under ITC Ltd.. For example, if price of Santoor is more than Vivel ,  than demand of  Vivel is more and vise-versa.
So, we can say that ITC Ltd is one of the good example to explain concepts of economics.