Group items tagged

I have found this article suprisingly amusing as I am a chocolate lover. The article talks about the fact that the world demand for chocolate is outgrowing the cocoa beans available. Therefore the prices are rising dramatically, especially in Asia. The author assumes that by 2020 the prices will be extremely high, because the demand is becoming unsustainable. I believe that this is a great article to illustrate what I have learnt in the past chapter because it illustrates a real world situation where the price rises with the supply.

A trend is shown where global interest rates gone "relentlessly downward over the past few decades". The rich are getting richer, leaving the rest of the group with less wealth. In addition to that, the rich have a "lower propensity to consumer", this has caused the aggregate demand to fall. It has been noticed that central bank rates have also "trended progressively lower". A conclusion has been made in the article that "as long as wealth and income inequality continue to widen, there will be a savings surplus."

the price of commodities are rising which is leading to an increase in demand of the commodities. Also Agregate demand is increasing due to lower exchange rates, higher equity prices, and higher inflation expectations.

This article talks about how oil and how oil is becoming a very limited resource. The demand on this resource is high and has stayed that way. So because the price raised and the demand is still the same they have to supply a lot more equally everywhere.

The price of coffee has been going up and will keep at it but this doesn't seem to affect demand as demand is still increasing. Now quality is not affected by price. These can be based on the fact that the product is addictive and not many substitutes will suffice. Some even think of it as a ritual every morning.

I agree that coffee is inelastic because it is typically contains caffeine which is an addictive drug. People are addicted to coffee and depend on it as part of their daily lives. They cannot function without it, or are at least unwilling to. Therefore, consumers will continue to purchase coffee despite rising prices. Coffee drinkers also enjoy the last of coffee and are not willing to switch to other caffeine filled drinks such as tea or soda because they are not close enough substitutes. In fact, coffee consumption has actually increased despite rising prices. Consumers will not change their tastes unless prices become drastically higher.

i agree with the point that the change in qunatity demanded is not very significant. This is due to the fact the coffee is a habit forming good and addictive to most coffee addicts. However it also depends on the proportion of income spent on the good. Coffee prices can range from being dirt cheap at hawker centres to expensive at cafes like Starbucks. Hence even if the consumer is not a coffee addict, and only a small proportion of income ( if it is 'insignificant' ) is spent on the good, then a change in price will not affect the spending behaviour ; demand is price inelasic

The biggest long-term factor in the oil price is the cost of replacing oil wells as they run out ("deplete" in industry parlance). Rising oil prices will not decrease demand , as oil is a necessity and it has a price inelastic demand.

- In this article, Nomura has seen an 8% GDP growth for the fiscal year. Chief economist in India states that some factors that caused the growth include "policy efforts from both the RBI and government support the projections for higher growth." Foreign investors continue to rise on the stock market which is evidence of the rise in investors participating in the market.

This article illustrates two economic terms, the business cycle and consumer confidence. The UK economy is currently going through a boom phase, suggesting inflation is rising. This may seem good now, but higher inflation causes less competitiveness for exports, which will lead to a recession phase. It's the business cycle. The article also describes how job opportunities went up, which is likely to cause consumers to consume more, because they are expected to get a raise or promotion soon. This adds to the boom even further. Knowledge of this makes it easier to make economic decisions and explaining why events take place like they do.

The global oil equilibrium has become extremely fragile and the price of oil has been rising without stopping. Which has been causing the supply to increase but the demand to decrease significantly. Throwing it off its equilibrium

This article is really interesting because oil is so important to us in so many ways. As with the example of the couple in Iowa, everything from transportation to feeding animals is affected by the changes in price. The smallest increase in price could cause a shift in equilibrium and could leave hundreds, if not thousands, of people facing shortages.

In this article they take about how it impacts how people travel when prices of gas rise. Oil is very important because it operates cars and other useful technology we have. Without oil there will not be no electricity.

This article looks at the Elasticity of Demand and Supply for oil. The increased costs of the production and higher prices are not leading to a fall in demand, but instead a fall in the elasticity of demand.

This article fits in my opinion very well to the topic of elasticities. It deals with price elasticity of both supply and demand for oil. The author is concerned with the increasing inelasticity of supply: "reserves we're now exploiting are not only more expensive to develop, but they also take much longer between the time the first well is drilled and the when the first oil is produced". There's also a graph in the article which shows the constant fluctuations of both supply and demand for oil, and how the American oil supply struggles to adjust itself to American demand for oil.

This article addresses the changes that have occurred in the oil market over the past ten years. The author claims that changes in the demand of oil have increasingly been playing a role in maintaining the supply/demand balance. He argues that these changes will be burdensome to our economy unless the demand for oil is made more flexible. According to the article, there is not a shortage of oil. Today, due to rising oil prices, we are able to exploit oil reserves which were previously too expensive to exploit. Since these new oil reserves are more expensive to develop and take longer to access, the time it takes for oil supply to respond to changes in price is increasing as well. This means that "...the oil is becoming less elastic..." meaning that "a large change in price produces a small change in supply." In regards to the elasticity of demand, "the elasticity of oil reflects the options we have to using oil for our daily needs." Our ability to reduce oil consumption is fairly limited in the short term, but increases over the long term. However options for reducing oil consumption over any time period are often inconvenient. Reductions in demand due to high prices can be called demand destruction (a permanent move down the demand curve toward reduced demand) which can be detrimental to the economy. This is why people such as the media and politicians wish to have supply adapt to changes in demand instead. However, "there are also limits to the ability of oil supply to adjust." Oil is not easily accessible. Because oil supply has become less elastic, prices has had to become more volatile to force market adjustments. The author concludes by suggesting ways that the elasticity of oil demand can be increased and the pain of demand destruction decreased.

This article speaks about the increase in demand for oranges because weather conditions have damaged the harvest of other fruit, such as apples and bananas. These weather conditions have caused the fruits to increase in price because of the lack of supply available. As a result oranges became the number one choice because of its lower price, so people were able to get more for their money. However, the wealth of the company producing the oranges hasn't been shared with the people due to the cost of transportation. They will see if these result will change depending on the next harvest.

This article shows what the problems could be if the households/consumers/workers demanded higher minimum wages. On research in this article says it will decrease employment and give less incentive to the firms to HIREpeople and give them higher wages. However, another studies show that firms might cut back on some benefits for the worker, they might improve the productivity of the product. Moreover, the workers might as well work harder. And much more. The point is that the workers will do whatever it takes to have a high income. Thus it is possible to say that higher minimum wages could improve the economy because then, the national income will rise. And then this will increase the overall GDP of the country, leading to a higher economic growth.

This article although an opinion piece is made up of many subtitles, the one I chose to focus on is Roosting chickens and Fed Bashing, It talks about how Druckenmiller keeps predicting economic dooms due to rising interest rates since he closed his business. Personally I feel this is like the quote we got that says, "looking at statistics...to save himself from having ignorance foisted on him", this article is about Krugman using his on look on statistics to see if Druckenmiller's predictions are accurate since some can say they were and others can say they weren't. Krugman gathers his knowledge from past experiences with 2008 crash and The Great Depression; with my own knowledge of the Great Depression and things that contributed to it's solution this drives me to say that government intervention and spending are what's needed to fluctuate the economy ( hence why people argue WWII was the real solution to the Depression due to it's massive spending).

Foreign unemployment fall cuts jobless rate Published on: 10 Apr 2015 09:23 CET Facebook Twitter Google+ reddit Switzerland's official jobless rate fell in March to 3.4 percent from 3.5 percent in the previous month, driven by a drop in foreign unemployment, according to government figures released on Friday. The decline marks the first time since June 2014 that the rate has fallen in a further indication that the Swiss economy is so far weathering the rise in the value of the franc, which forecasters have said will cut growth this year. The percentage of foreigners registered as out of work tumbled to 6.7 percent from seven percent, while the rate for Swiss citizens remained unchanged at 2.3 percent, the State Secretariat for Economic Affairs (Seco) said in its monthly report. The number of unemployed registered in regional job placement offices in March dipped by 4,813 from the previous month to 145,108, Seco said. But the jobless rate last month remained above the 3.3 percent level in March 2014. The rate declined or remained the same in all 26 cantons with the canton of Valais recording the biggest fall, from to 4.6 percent from 5.4 percent. Neuchâtel registered the highest rate (5.7 percent, down from 5.8 percent), just ahead of Geneva (5.6 percent, unchanged). Obwalden had the lowest rate at one percent, down from 1.1 percent. Unemployment in Zurich, Switzerland's largest job market, remained unchanged at 3.6 percent. The impact of the strong franc may not have yet affected the Swiss job market but observers believe that unless the currency weakens, jobs cuts can be expected. In January, the Swiss National Bank abandoned a policy of maintaining a euro floor of 1.20 francs and foreign exchange traders immediately bid up the value of the franc. On Friday, with uncertainty about Greece's finances lingering, the euro was trading at around 1.04 francs, making life difficult for Swiss exporters selling products into the eurozone, the biggest ma

Consumers are upbeat about the economy and their future income prospects, according to the University of Michigan's latest survey. The preliminary headline consumer sentiment index for November was 93.1. Economists had estimated a rise to 91.5 from 90, according to Bloomberg. This increase is likely to become evident in higher consumption, which will shift the AD curve right, thus increasing short term aggregate supply.

The rate of unemployment in the UK for the people of ages 35 to 49, who are considered as the older group of workers, was only 4.7%. Compared to them, the jobless rate of the people aging 18 to 24 years was around 18%. The rate of unemployment in these young people increased almost 30% between the first quarter of 2008 and the fourth quarter of 2011. According to ONS, "The burden of higher unemployment has therefore fallen most heavily on younger workers". The most significant cause of the significant rise in the rate of unemployment among all workers, especially targeting the youth age who are just out in the work force to find jobs, is the recent economic crisis.

China is known for being a very populous state and the leading commodity producer, as a matter of fact American trade with China is considered one of the largest trading markets. So it would be expected that China's depreciation is affecting so many countries. The Mexican peso dropped by 1.1%, and the Colombian peso by 1.3% . This means their the amount of Chinese money that could be exchanged with just one of that country's peso has decreased. Economists are blaming it on falling oil prices and weak economic data. This was foreseen depreciation was foreseen as oil demand was already decreasing and investments into China were low so as preparation Colombia has raised its lending rate. This could work and help combat the inflation that has been caused because it would influence trade and investments. This is all in hopes that the exchange rate will rise again.

Economic growth in Africa is expected to accelerate to 4.7% this year and 5% in 2015, but the advance is failing to translate into job creation and the broad-based development needed to reduce high poverty and rising inequality rates in many countries, the UN has said.

Along with the high amounts of violence in Burundi the inflation rates in the country are also increasing. The inflation rates in Burundi has risen to 5.6%. This should cause the Burundi economy to contract by 7.2% but it grew 4.7%. After President Pierre Nkurunziza won the election in a controversial violence in the country has significantly increased causing many donors including Belgium. The country's economic status could worsen if the violence continues and donors remove their aid. The European Union funds 50% of their annual budget and they are threatening to suspend if Burundian authorities do not their countries issues with diplomacy.