Over the last few years a whole new type of car has been propelled into the market. A chance to change our world and make it more environmentally friendly. A hybrid car is an automobile with more than one power source, such as an electric motor and internal combustion engine or an electric motor with battery and fuel cells for energy storage. Toyota have launched their car into this market taking the hybrid car market by storm. As of today the Prius leads the green car market easily. This report will look into the fundamental economics behind electric cars in the current day market and how the demand has changed throughout the year.
The demand for the Toyota Prius is affected due to certain factors within the market. The population has a huge influence on the sales of the Toyota Prius. Over time the population has increased massively and carries on increasing every day. For the last 50 years, the world’s population multiplied more rapidly than ever before. The increasing population is set to continue in the future with the rate of population increase growing every day .In 1950, the world had 2.5 billion people; then in 2005 the population more than doubled , the world had 6.5 billion people. By 2050, this number could rise to more than 9 billion. More people being brought onto the earth ready to help the economy. If the population increases there is more people to buy the Prius, so therefore the quantity of sales will increase. This means the demand curve shifts right giving a new equilibrium. This equilibrium means that the