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    No 11

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    Shy Cabuenas
    a. Since typhoons will hit Luzon and Mindanao, vegetable demand will fall as people stock up on canned goods instead. The supply may remain constant, but the equilibrium quantity and price of vegetables will fall in the short run. b. Oil prices rise as oil companies maintain production quotas despite lower demand during the pandemic. Both supply and demand curves shift left, but demand shifts more, so the equilibrium quantity falls and price rises. c. During rainy seasons, vegetable supply increases due to faster growth and harvesting. However, production costs also rise. Therefore, both supply and demand increase, but demand increases more, causing equilibrium quantity and price to rise.

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    No 11

    Uploaded by

    Shy Cabuenas
    31 views3 pages
    a. Since typhoons will hit Luzon and Mindanao, vegetable demand will fall as people stock up on canned goods instead. The supply may remain constant, but the equilibrium quantity and price of vegetables will fall in the short run. b. Oil prices rise as oil companies maintain production quotas despite lower demand during the pandemic. Both supply and demand curves shift left, but demand shifts more, so the equilibrium quantity falls and price rises. c. During rainy seasons, vegetable supply increases due to faster growth and harvesting. However, production costs also rise. Therefore, both supply and demand increase, but demand increases more, causing equilibrium quantity and price to rise.

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    a. Since typhoons will hit Luzon and Mindanao, vegetable demand will fall as people stock up on canned goods instead. The supply may remain constant, but the equilibrium quantity and price of vegetables will fall in the short run. b. Oil prices rise as oil companies maintain production quotas despite lower demand during the pandemic. Both supply and demand curves shift left, but demand shifts more, so the equilibrium quantity falls and price rises. c. During rainy seasons, vegetable supply increases due to faster growth and harvesting. However, production costs also rise. Therefore, both supply and demand increase, but demand increases more, causing equilibrium quantity and price to rise.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    31 views3 pages

    No 11

    Uploaded by

    Shy Cabuenas
    a. Since typhoons will hit Luzon and Mindanao, vegetable demand will fall as people stock up on canned goods instead. The supply may remain constant, but the equilibrium quantity and price of vegetables will fall in the short run. b. Oil prices rise as oil companies maintain production quotas despite lower demand during the pandemic. Both supply and demand curves shift left, but demand shifts more, so the equilibrium quantity falls and price rises. c. During rainy seasons, vegetable supply increases due to faster growth and harvesting. However, production costs also rise. Therefore, both supply and demand increase, but demand increases more, causing equilibrium quantity and price to rise.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    11.

    Graphically illustrate and indicate your major assumptions per item, and, what will be the observed movements in
    the demand curve, supply curve, equilibrium quantity, and, equilibrium price of the following conditions:

    a. PAGASA announced that there will be two consecutive typhoons that will hit the country within the month.
    The first one will pass through Luzon, and the other, in Mindanao. What will happen to the vegetables market
    in the short run?

    Since PAGASA declared the forthcoming calamities that will pass over Luzon and Mindanao, price
    expectations for vegetables in the market would be reduced in the short term since demand is low because people
    would likely pick canned products to store in preparation for the typhoon's arrival in certain areas. The supply may
    remain constant, but the equilibrium quantity and price will fall.
    V
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    b. Petroleum, gas, and, oil companies in the Philippines always increase the prices of diesel, gasoline,
    kerosene, and even LPG. Why?

    The factor that might cause oil prices to change is the impact of supply and demand. Nonetheless, at this
    time in the COVID-19 pandemic, supply and demand drove prices of diesel, gasoline, kerosene, and even LPG to rise
    steadily. Prices fall when supply exceeds demand; when demand exceeds supply, a scarcity occurs. While supply and
    demand have an impact on oil prices, oil stocks decide the price.

    The intergovernmental organization, known as the OPEC, or the Organization of Petroleum Exporting
    Countries, was the primary influencer of oil price variations, controlling about 80% of the world's oil reserves. The
    partnership determines production levels to meet global demand and has the ability to affect oil and gas prices by
    raising or decreasing production. Just like what happened last on January 4, 2021, when oil prices surged ahead of
    an OPEC members meeting, is the expression of supply and demand impact that produced oil price variations, as the
    world's largest oil producers are likely to maintain output quotas unchanged in February amid sluggish oil demand
    caused by the pandemic problem worldwide.

    As a result, the demand and supply curves both move leftward. However, a change in demand is greater
    than a change in supply due to the predicted retention of production quotas in February, which is the reason for
    insufficient oil demand amid the pandemic, resulting in a fall in the equilibrium quantity distribution of oil and an
    increase in the Equilibrium price.
    Oil Companies

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    c. In the Philippines, during the rainy season, vegetables grow faster and can be harvested faster – with good
    quality; but, why does prices still go up during this time?

    Heavy rainfall and an increase in fuel costs may have increased the costs of vegetables in the Philippines,
    putting an additional burden on the commoner by setting prices high regardless of the amount of demand,  despite
    the fact that during wet seasons, vegetables grow and can be harvested faster. However, the prospect of a large
    crop of vegetables in plentiful supply is an element that jeopardizes market output might be a rise in diesel prices,
    which impacts production, or excessive rain, which is a great welcome treat for many facilities.

    As a result, supply and demand move in opposite directions, but a change in demand is greater than a
    change in supply. Supply increases due to the harvesting season and high-quality veggies, whereas supply decreases
    due to limited supplies affected by production costs and severe potential damage during the wet season. Eventually,
    vegetables' equilibrium quantity and price both increased.

    Vegetables

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    d. During this time of COVID19 pandemic where the economy shrunk and businesses close, it has been on the
    news that car manufacturers are still bullish on their sales forecast and are even offering very low prices.
    Why?

    COVID-19 has a significant impact on the global automotive industry, resulting in an increase in car sales. Despite
    the fact that the economy shrank and businesses closed during the pandemic, car manufacturers are optimistic
    about sales and are even offering low prices. COVID-19 has affected the current buyer's perspective because most of
    the purchasers are people who might rely on buses or Uber wherever the discomfort of doing them as much any
    more encourages the consumer to buy a car as they also want to purchase affordable ones to reduced face to face
    encounters in public transportation. Some are front-liners who now require a car, and others are families who
    realize that road vacations are the only option to a getaway at this time because traveling in their car is much safer
    to do so. So, offering lower prices of cars for the public to afford lower price ranges despite the increased demand is
    understandable because of the current crisis that we have experienced. With more supplies of cars and higher
    demands of it, higher profit is possible in the upcoming future.

    Thus, the supply and demand both move, but a change in supply is greater than a change in demand where
    supply and demand increased as same as with Equilibrium quantity of cars, but equilibrium prices decreased.

    Cars

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