Demand & Supply Analysis

Headline:Jakarta: Poor food distribution, bad thole come out of the closet worsen worth problem Source:The point Times Date:Friday, 10 family 2010 Summary Newspapers reports and figures released by Indonesias Central Statistic Agency confirm that consumers rush been forking out more(prenominal) for staples and other food items. The some(prenominal) reasons that constitute to the emerging food harms nuclear number 18 seasonal fort in consumption, peculiar(a) income, lack of decent infrastructure and weather. colligate Economic Concepts want of a product refers to criterion which tidy sum ar willing and able to buy at contrastive damages, in a specified time period, ceteris paribus. Change in exact (for a given supply swerve) If one of the non-price determinants of adopt changes, the motif make out will shift. [pic] When the rent of food increases, the demand curve will shift to the right. Both the balance price and quantity will increase. Economic Analysis As mentioned in the article, during the Aidilfitri jovial period, the demand of staples and other food items increases. Staples and other food items atomic number 18 considered as normal goods. The demand increases only when consumers income increases. This was evident in the article as civil servants got their bonuses which will lead to higher(prenominal) outlay power.

As a result, everyone ended spending more coin on staples and food items during the festive season and thus resulted in the rise in food prices. From the economic perspective, when the demand o f a good increases due to a non-price determ! inant, the demand curve will shift to the right (D to D1) as shown in plot 1 below. The equilibrium quantity will increase from Q0 to Q1 and the equilibrium price will increase from P0 to P1. Diagram 1 [pic] Conclusion To have the rising prices of staples and other food items, Indonesia government may realise price control on certain products during the festive season. Controls stack undertake a price ceiling, or a...If you want to make grow a full essay, order it on our website: OrderCustomPaper.com

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