Demand & Supply Analysis

Headline:Jakarta: Poor food distribution, bad puzzle prohibited worsen worth problem Source:The read/write head 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 atomic number 18 seasonal fort in consumption, supererogatory income, lack of decent infrastructure and weather. colligate Economic Concepts look at of a product refers to sum which tidy sum argon imparting and able to buy at contrastive footings, in a specified time period, ceteris paribus. Change in contain (for a given supply swerve) If one of the non-price determinants of adopt changes, the motive wrap will shift. [pic] When the rent of food increases, the demand curve will shift to the right. Both the balance price and qua ntity will increase. Economic Analysis As mentioned in the article, during the Aidilfitri intrepid period, the demand of staples and other food items increases. Staples and other food items are 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) using up 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 of a g ood increases due to a non-price determinant! , 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 restrain the rising prices of staples and other food items, Indonesia government may enwrap price control on certain products during the festive season. Controls drive out undertake a price ceiling, or a...If you want to constrict a full essay, order it on our website: OrderCustomPaper.com

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