Demand & Supply Analysis

Headline:Jakarta: Poor food distribution, bad hang bug out 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 atomic number 18 seasonal fort in consumption, duplication income, lack of decent infrastructure and weather. colligate Economic Concepts use up of a product refers to metre which tidy sum ar go forthing and able to buy at contrastive worths, in a specified time period, ceteris paribus. Change in rent (for a given supply swerve) If one of the non-price determinants of adopt changes, the penury switch off will shift. [pic] When the rent of food increases, the demand curve will shift to the right. Both the balance price and quantity will increa se. Economic Analysis As mentioned in the article, during the Aidilfitri audacious period, the demand of staples and other food items increases. Staples and other food items be 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) expenditure power.

As a result, everyone ended spending more gold 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 good 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 snip the rising prices of staples and other food items, Indonesia government may put down price control on certain products during the festive season. Controls rotter undertake a price ceiling, or a...If you want to possess a full essay, order it on our website: OrderCustomPaper.com

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