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Microeconomic Assignment - Week 1 - Group 8

- The document discusses the high cooking oil prices in Indonesia. It provides background on the government's policy to set a highest retail price (HET) and explains that prices have still exceeded the HET by up to 2 times. - It notes that the price increases are due to several factors, including late deliveries from distributors, high public demand, and increases in global CPO and vegetable oil prices from weather issues impacting production. - Finally, it presents supply and demand curves to illustrate how the price changes have shifted the equilibrium point from a decrease in supply and increase in demand.

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Sayyid Al Hanif
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61 views11 pages

Microeconomic Assignment - Week 1 - Group 8

- The document discusses the high cooking oil prices in Indonesia. It provides background on the government's policy to set a highest retail price (HET) and explains that prices have still exceeded the HET by up to 2 times. - It notes that the price increases are due to several factors, including late deliveries from distributors, high public demand, and increases in global CPO and vegetable oil prices from weather issues impacting production. - Finally, it presents supply and demand curves to illustrate how the price changes have shifted the equilibrium point from a decrease in supply and increase in demand.

Uploaded by

Sayyid Al Hanif
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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MICROECONOMICS 1 - D

Group 8 - Session 1
You can access the recorded
presentation at the following link:

https://drive.google.com/drive/folders/19
Rohananda Devi (2006583620) slHId1IyPRFHMHY9t003Q3Q_AR9ENDM?us
Romauli Teshalonika Sihombing (2006468434)
p=sharing
Ryan Ostmar Haque (2006523161)
Saverio Davin Ditasyah Riyandi Putra (2006469185)
Sayyid Al Hanif (2006520304)
Syamil Islami (2006583646)
01
Case Description

Source : tvOneNews Youtube Channel


01
Case Description
- Initially, the government only imposed a
one-price cooking oil policy at modern retail
with a HET of Rp. 14,000 per liter. However, in
reality, the stock of cooking oil is empty in the
market.
- On February 1st 2022, Ministry of Trade
Republic of Indonesia set a highest retail
price for three categories of cooking oil.
- The oil’s price still much higher than HET even
up to 2 times.
- The cause of the stock vacancy is the late
delivery of cooking oil from distributors and
the high enthusiasm of the public to buy
cooking oil.
02
Additional
Information
According to Faisal Basri, lecturer at Faculty of
Economic and Business Universitas Indonesia, state
that the price of cooking oil has risen due to a
government error that has caused CPO to become
a competitive commodity between food
commodity and energy industry (biodiesel).

According Prof Dwi Andreas, lecturer at IPB


University state that the current high price of
cooking oil is due to a lack of supply as a result of
the significant increase in demand for palm oil from
outside. As a result, business players profit from
higher commodity prices.
02
Theoretical Base

- The demand curve has a downward slope to the right (negative slope) which means that if
the price of an item increases (the assumption that others remain- ceteris paribus) then
consumers will tend to reduce the demand for these goods, and vice versa and this is
called the Law of Demand.

- The law on the supply curve states that if the price of an item increases, the quantity
supplied will also increase on ceteris paribus terms. This curve has a positive gradient or
slope, meaning that the relationship between price and quantity supplied is directly
proportional.

-
02
Theoretical Base
- The increase in cooking oil prices was influenced by world crude palm oil (CPO).However,
apart from CPO, there is also another factor, namely the increase in world vegetable oil
prices. The reason for the increase in prices was due to weather disturbances which
suppressed the level of world vegetable oil production.

- The Covid-19 pandemic is the main reason for cooking oil prices to continue to climb. The
reason is that due to Covid-19, CPO production has decreased drastically, besides that the
flow of logistics has also been disrupted.
-
02
Theoretical Base
- This increase in cooking oil prices will make changes in the supply and demand curves. On
the demand and supply curves, an increase in prices can shift the equilibrium point
causing excess demand
-
P
S

P’
P

D’
D
Q
Q Q’
Curves Explanation (Supply)
P

S
E Decreasing price of cooking oil
Rp28.000 from Rp28.000 to Rp14.000 make
the equilibrium move along the
supply curve from E to E’
E’ resulting in less supply (from Q1
Rp14.000 to Q2).

Q
Q2 Q1
Curves Explanation (Demand)
P

Decreasing price of cooking oil


E
Rp28.000 from Rp28.000 to Rp14.000 make
the equilibrium move along the
demand curve from E to E’
E’ resulting in more demand (from
Rp14.000 Q1 to Q2)

D
Q
Q1 Q2
References
tvOneNews. (2022, February 8). Minyak Goreng Langka? Pedagang Mengambil Stok Minyak Goreng Dari Agen | tvOne.

YouTube. https://www.youtube.com/watch?v=2r1PdeDqWfE&feature=youtu.be

Narasi Newsroom. (2022, February 8). Kata Faisal Basri, Harga Minyak Goreng Meroket karena Pemerintah. Maksudnya?

Narasi Daily. YouTube. https://www.youtube.com/watch?v=A-kGiOvY0UI&feature=youtu.be

tvOneNews. (2022b, February 9). Minyak Goreng Langka, Pedagang Cari Pasokan Dari Agen di Atas HET | Kabar Pasar

tvOne. YouTube. https://www.youtube.com/watch?v=3yW06lURV_Y&feature=youtu.be

https://voi.id/en/economy/118916/good-or-bad-news-new-cooking-oil-prices-will-drop-in-february-2022
SESSION 1 - GROUP 8

THANK Rohananda Devi


Romauli Teshalonika Sihombing
(2006583620)
(2006468434)

YOU Ryan Ostmar Haque


Saverio Davin Ditasyah Riyandi Putra
Sayyid Al Hanif
(2006523161)
(2006469185)
(2006520304)
Syamil Islami (2006583646)

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