Avocado Prices

This article by Lara Webster very clearly shows the economics going on behind the avocado market right now. The demand for avocados has steadily increased in the past 10-15 years and is expected to keep increasing. However, there is a relatively low supply of avocados. The article says that there is an expected increase in the supply of avocados to respond to the high demand for them. The demand continues to increase because of the new health benefits that have been found in avocados. The article also points out how since avocados are such a unique fruit, there are little substitutes for them so consumer demand for them is relatively inelastic.

http://www.abc.net.au/news/2016-01-20/australian-avocado-prices-hit-record-highs/7099046

1 Comment »

  1. Brendan Said,

    December 12, 2016 @ 1:37 pm

    Good job using the concepts of supply and demand. Also liked how you discussed substitutes and how that creates an inelastic demand.

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