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The Japanese automobile maker Nissan announced a couple years ago its plans for a new completely electric car, the Nissan Leaf. However, sales in the United States have been fairly low, only selling 10,000 of the cars in 2012. The reason for the small amount of sales is believed to be caused by its high price, due to an expensive and large battery back in the car, and the fact that the car has a small 80 mile range. In hopes to increase sales, the company is beginning to start production here in the United States. Producing the product closer to where it will be purchased will reduce production costs for the company, allowing it to decrease the price of the car and leading, hopefully, to an increase in demand.

Nissan is opening up a production plant in the U.S. to produce their car, the Leaf electric car. This is the first production plant. The short term is the building of the plant, which should decrease unit costs because they will no longer need to transport the cars to the U.S. The long term is the plan to create new technology to improve the car (battery, charging, etc.) and hopefully increase the demand, which could reduce unit costs even further. 

The demand for the product increase by the main factor which is called appearance of the product.The designers by coming up with unique ideas make the products uniqe and highly desitred by making them interesting. The internet is a great access to determine which type of products are in need and highly desired also the eye pleasure of customers take a great role in designing.Therefore, if the designers increase demand of consumers and make more profit they would pay amount of money to make it better and make people to buy the product so the desing of the products in corporation with the internet access increase the competition between firms and they will all consider the appearance of their products that they sell and willn try to get the most of the profit.

This article talks about the organic milk shortages, that farmers can't buy enough food to feed their caws because the price for their food has been increased, as a result they give less nutrition to their caws and get less milk. But demand for organic milk is still high and in the article they will some suggestions how to solve that problem.

The demand for organic milk is greater than supply because the production cost of creating organic milk is greater than the revenue. The reason for the shortage is that the cost of organic grain and hay has gone up but the price farmers receive for milk has not. As a result farmers buy less grain and hay which lowers the production of milk. The low supply of organic milk than in turn increases the overall price. The solution for this issue would be to increase the price of income the farmers would receive for their milk. If the solution were applied, the farmers would pay more for organic grain and more milk would be produced and consumers would be satisfied.

When it comes to the reasons of deflation most of the economists see it as a monetary phenomenon which is affected by demand and supply. If the supply of money is more than demand then the value of money increases and prices go up as a consequence. When the supply of the products are higher than demand it results with the mass production which leads to the fall of prices. Some people believe that the deflation occurs because of the mass production and falling the aggregate level of demand. The biggest effect of deflation is unemployement. Deefletion is more serious and dfficult than inflation. To prevent deflation first is give an upward push to the aggreagte demand by increasing government spending or the second they can increase the money supply by decreasing cash reverse ratio.

When it comes to the deflation some of the economists believe that it is a monetary phenomenon which is affected by supply and demand. The reasons that leads to deflation are if supply of money is less than its demand than the value of money increases and the prices would go up. If the supply of the product is more tha its demand then it will lead to the mass production which the large amount of products will lead the prices to fall immidietly. The biggest effect of deflation is unempoyment. Deflation is more diffucult and serious than inflation. To prevent deflation first give an upward push to the aggregate demand by increasing government spending or the secong they can increase the money supply by decreasing cash reserve ratio.

Economies of scale is the increase in efficiency as a company gets bigger. In this case the economy of scale is the creation of larger shipping containers. The great thing about scales of economy is that it has lowered the production cost of products such as the creation of t- shirts for some companies. However as companies have more products to they needed bigger containers to transport their goods. As the supple of t- shirts increases the size of the ship that transports the goods needs to increase in size as well. Maersk lines , the world's biggest shipping container company has decided to increase the size of his ships. The company plans to build 20 ships with a capacity of carrying 18,000 twenty-foot equal units. The company does this out of efficeny in transportation and gas cost. The larger the ship the more it can carry and the less times the ship will have to travel back and forth to transport goods. The increase in ship size than is an example of the economies of scale when bigger = more efficient.

In theory perfect competition hinders innovation. As small firms produce homogeneous products for the same price the motivation for innovation decreases. However, a society needs innovation. It is through innovation that businesses grow and better the future. For example, the creation of the internet, cars, and electricity. When a market has its firms create similar products at the same price , firms will be less likely to innovate products.

This is an interesting article about the contract that is now up for grabs to decommission nuclear waste. Nuclear waste is a great example of negative externalities, as it is a negative by-product of production, and, as can be seen in the article, it is quite hard to get rid of, and quite expensive as well.

This article discusses the new Chevy volt hybrid and debates it's future. it can be said that the company, in regards to this car, is going to start benefiting from economies of scale as in the article it states that the production cost will become cheaper however it is obvious that the company is not producing at the minimum efficient scale as allegedly for each volt it sells, the company loses $49,000

Currently, the Chevy Volt costs $89,000 per car to produce. However, GM is selling the car at about $40,000, offering even more discounts in certain places to reel in customers. GM argues that in the long run, the production cost will decrease and begin to bring in profit.

This article is an excellent example of the concept of long term vs. short term decision making by a company. Right now, GM is losing massive amounts of money whenever they make and sell another Chevy Volt, but they hope the investment will pay off in the long run.

The production costs of the Cirque have been determined to be simply too high making the company unprofitable. They then decided to lay off 400 employees in order to cover costs.

This article talked about how an Iceland company Carbon Recycling International ehf, saw the rising demand and planned to increase output. It made the firm more efficient because recycling carbon reduced cost and saved resources. It also reflected the situation of perfect competition. Oil companies are price takers, they can't control the price of oil. And the product are homogeneous: oil form different company don't have significant quality difference.

In the old days there wasnt really monopolies they were mostly quasi-monopolies. The government owned enterprisis and there were not really private sectors and only customers were the one that was suffering but since the old days are gone most of things changed. They believe that monopolies are preffered by consumers and companies instead of competition. The developing technology is a great factor in a way of helping firms to advertise their product to convince people or take people's attention to buy the product. The advertisements and the high prices of products convince people to buy the product because they trust the price and the trusworthiness of the firm.

This article talked about the elasticity of gasoline. As the price increase 10 percent, the demand reduce by 7 percent, which prove that gasoline is inelastic product. That make sense because gasoline is a necessary product: to keep the cars run.

The article is talking about the federal government which has shut down today because of an impasse over the budge and in two weeks, the nation is set to hit its borrowing limit.The major problem in the articles is that there is an oversupply of global labor, an oversupply of global productive capacity and an oversupply of global capital. The jobs created low wages and part time. Growth in domestic manufacturing is still slow which will prevent the development of a country in their own production and prevent the large amount of profit they will get as a result of the domestic production.Business spending has fallen, rents of the houses falling where home prices have increased. The reason why its hard to get out from the rut is because they are no longer faced with a world in which supply-side economic remedies, easy money, reduced taxation, fiscal belt-tightening and deregulation can spur new capacity and the creation of well-paying private sector jobs.Countries that were recently poor find themselves with huge surpluses and sovereign wealth funds. The rich countries of the world, while still rich, struggle with monumental levels of debt, both private and public, and unsettling questions about whether they can compete globally.Also to clear this mess,developed nations need to put the huge surplus of underemployed workers back to work by any means, including big public sector investments to improve infrastructure and competitiveness.Moreover, a new economic multilateral ism with the developing world, to encourage them to re balance their economics away from savings and toward consumption, while we in the West must curb our addiction to credit and consumption is necessary.

Indian government has announced that 60% of entire domestic pharma market will be under official price control. The policies of National Pharmaceuticals Pricing Policy will cover 348 products on the 2005 National List of Essential Medicines (NELM) plus others added to the newly-updated List (NELM-2011), which includes some 450 products.The long-awaited draft policy would also change the way prices of controlled products are regulated. Under the current Drug Price Control Order (DPCO), prices are based on market share, but the government's draft policy proposes changing to a system of setting a ceiling on the prices of formulations based on the Weighted Average Price of the leading three brands.

This article talked about the negative externality of Jinko Solar company in China. The company washed the pollutants with fluoride exceeding normal limits from factory into a river. The pollutants caused mass die-off fish and a cluster of cancer cases. Many Chinese resident gathered around outside the factory and hold violent protest, which forced the company to shut down. Government also halted the company and fined $75,000. From this article we can see how the product had negative externality to the third party and how government react upon it.

Due to it's low production rate, Chevron resolved to sell its stocks to save itself.

This article is very interesting in that it shows how a massive company like Air France is making decisions to cut spending drastically in order to reduce their production cost. On a side note, I found this article thanks to my french class, so if any of you are french / speak the language and would like a more interesting view on the topic, check out this link. http://www.france2.fr/jt/20h/

The article talks about how chipotle's production cost of meat has risen therefore forced to increase menu prices.

This article talked about how VW company decide to use one billion dollars to build LEED Platinum to make their car 25% cleaner. In the short run the production cost increased one billion. Since the car will get cleaner, the demand should increase. 

This article talked about how Apple broke the monopoly in computer industry controlled by Microsoft. 14 years ago Justice Department worried that without government intervention, consumer choice would be significantly limited by Microsoft. However, today Apple broke this monopoly and took a big share of market. By using non-price competition and creating innovative product, Apple survived and succeed in computer industry. So we can see there is no such thing as a monopoly in computer industry, the advancement of technology will always give the market to the firm.