Economics HL - Jacob Solomon's group - Year 1

A tad early, but Christmas music will be coming on the radio next week! At least here in DC.. The article outlines a government plan to make a little extra revenue, and how that plan was so fiercely opposed. The tax would be imposed on the producers, given that they produce more than 500 trees a year, and in turn the producers would probably have to increase their prices. Since it is a specific tax with a fixed amount of $0.15 (not dependent on the price of the trees) it will shift the supply curve up. Even though the article states that the program "wouldn't have any impact on the final price consumers pay for their Christmas tree" - there would be an inevitable small impact at least in one retail area of the trees. Since there are so many consumers that will want Christmas trees, a tax would bring in a fair amount of money, as there are no substitutes for Christmas trees.

This article talks about that the increase in price for starbucks had an major impact on their costumers. Their costumer rate have decreased since the price increases, their price elastics was not calculated fairly, which had an impact on their service and costumers.

This article may or may not actually affect any of you, but it was interesting nonetheless. Kimberly-Clark, the company that produced Huggies diapers (among other things) is being forced to raise their prices because of higher oil costs and "tight supply driven by strong demand in China". The entire article talks about whether or not people are willing to pay more for their products, which would in turn indicate their inelasticity (as hinted at in the first paragraph).

This articles talks about the retailers are managing to increase their prices and pass on higher costs onto their customers. Its talks about how people think that increasing the price will not change the demand or quantity because consumers would accept the price increase because all retailers have the same cost structure and would start to pass the higher prices through. It also talks about that they can increase their prices because their is no substitute for their product. In general there is a economic growth within the world. Average prices in the apparel market rose more than 5 percent from January to May.

This article discusses the rising problem in New Zealand, of rising prices on dairy products. We can see a distinction in this article between milk, on one hand, and on the other, butter and cheese. Milk in relatively inelastic, because it is a necessity for a healthy diet (especially for growing children), however milk and cheese are relatively elastic, because they are not as vital for a good diet, and their demand will likely drop a lot more than the demand for milk.

This shows price elasticity, because despite the fact house prices keep rising, people keep buying them for eleven straight months.

This shows that if oil was an elastic product then the prices for it wouldn't rise so much, but because it is a necessity, people are willing to pay more for it and they have to put up with the rise in prices.

The quantity demanded of this products changing with the change in price of the products.

This particular article relates soda to alcohol and cigarettes whereby consumption of these goods are bad for health but even after numerous ways to decrease consumption, the determinant having the biggest impact on consumption was proven to be the price of sodas.

This artcile is discussing Sony, one of the largest technology brands on the market, and how in the modern day, average customers are becoming more savvy and wait for the drop in price of such consoles as the PS3 before purchasing the product, as a result of price elasticity

Today, we are one of 7 billion people on Earth. This historic milestone is rekindling age-old debates over birth control, protecting natural resources and reducing consumption. It also has many wondering whether the Earth can support so many people. About half were added just in the past 40 years, and 3 billion more are expected by 2100.

According to Carl Haub, "Currently, world population is growing at the most rapid pace in history." And today, growth is highest in poorest countries where health care advances are keeping people alive longer while birth rates are still relatively high. Therefore in the future, there will be more shortages in food and the price of everything will be going up. There will not be a equilibrium of the economy after all.

"The study looked at 'demand elasticities' in Australia for 15 food categories and is the most comprehensive ever done in the field. The degree to which a product's demand or supply reacts to a change in price is known as its 'elasticity'" This article highlights that out of 15 food groups studied, milk, bread, fresh fruit and fresh vegetables all have an inelastic demand. This is the opposite as to what i personally would have predicted, because with varying prices and what i assumed was a varying demand for fruits and vegetables, i thought that this could be an elastic demand. Some of the products with an elastic PED are All meat types, rice, margarine and preserved vegetables. This is interesting as it seems as though consumers would rather pay more to have food that can spoil, compared to food which can be stored or freezed.

This is 'bout the elasticity of oil. The price of oil is increasing. Will people now start to use trains/etc. more?

In India, silver is in high demand during the festive season of Diwali. This article discusses how in the case, the demand for silver is relatively inelastic, because the demand has stayed relatively the same while the price has increased around 30%. Since silver in sweets is a tradition, most people will continue to purchase edible silver leafs for Diwali even when the price increases, and so the demand for silver leafs is inelastic at this time of year, but when the festival is over, the demand will once again go down and become more elastic.

Aug 8th 2011, 14:29 by R.A. | WASHINGTON TODAY'S biggest news is the word that the European Central Bank is intervening in European debt markets in force, buying up Spanish- and Italian-government debt. The ECB spent last week expressing reluctance to take this step, but without it, the euro crisis threatened to spin irretrievably out of control.

This article shows how demand for Italian bonds are falling even though prices are falling. This is because they are becoming far too low and until the yield falls again there will be a decrease in demand.

This article is about Italian Bonds. For the demand curve (and also the supply curve), there are multiple equilibria. This can be dangerous, because when the yields rise, de Italian debt may be unsustainable.

Due to the unique shape of the demand curve there may be two or more places where the market is at equilibrium. This means that producers may be able to vary their prices more and still be able to get the highest possible profit from their products.

This article concerns the increased taxes being imposed upon alcohol in Sri Lanka. The reason for this is because alcohol is viewed by many as a 'necessity', and is also addictive (which makes it a necessity). This makes alcohol a product with inelastic demand; as an increase in price will result with a proportionally smaller decrease in demand. This avoids chances of unemployment by increasing the product's price, and is therefore a reason for the increase in the imposed tax upon it.

The China Business news reports about the increasing gold prices of China. The elasticity of the product is going to be incredibly low and inelastic because gold is so unique. Of course there are faux-gold substitues, however gold is the real deal. Having a shortage of gold, combined with economic uncertainty, means that the #3 gold producer's prices may continue to change.

This articles talks about how the export growth of 2.4 percent in September has created growth in overseas shipments because as the yen is getting stronger Japanese products are getting more expensive in overseas markets compared to Asian rivals such as China and South Korea. Due to the fact that the products has increased in price the demand for them has risen because people think that they are worth more, however the supply has decreased due to the increase in demand.