Willingness to Supply Gold

This article describes the struggle of African Barrack Gold, a gold mining company that is more reluctant to sell it’s gold as the price of gold continues to fall. With the London based company losing %60 of its value per share and gold at $1300/oz the company is losing profits. The article goes on to say that the supply of gold is diminishing because of a rising in production costs which are affecting miners profits. This article is useful in illustrating how production costs can affect producer surplus and supply curves.

http://www.ft.com/cms/s/0/d7503d88-1ebe-11e3-b80b-00144feab7de.html#axzz2gL3QMOR8

1 Comment »

  1. dolanr Said,

    October 8, 2013 @ 2:30 am

    This article is a very good example of some of the topics covered in class. The fact that the African Barrack Gold mining company is refusing to sell their gold is a economics strategy. They are going to wait until the market turns back around and they can get more money for their product. This is a form of selling on speculation. They are assuming that at some point the market will turn around for the better.

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