Archive fordemand

Appeal to Out of State Students

Many “undistinguished state institutions”have recently experienced a significant decline in demand causing a notable decline in enrollment. In order to raise the demand, some colleges are considering cutting the out-of-state surcharges entirely. However, because of the revenue raised from admitting out-of state-students and charging them additionally, the colleges must be able to enroll at least 50% more out of staters to maintain the revenue that the college generated beforehand. The rise in out-of-state students is anticipated with an increase in costs as the marginal cost will be above zero to accommodate the spike in enrollees. However, though the marginal cost is kept low, it may be too much to run a successful university. The article goes to explain that international and out-of-state students are more inclined and have been proven to be drawn to flagship state universities with higher surcharges as the students consider the value of these more recognized schools to the less expensive schools. The supply of the “undistinguished” schools appeals to draw more people in at a lower cost, but the demand does not change. The marginal benefit of attending a more recognized state school overrides the monetary cost and benefit of the cheaper schools and therefore, the demand for the former type of universities remains high and fairly inelastic.

 

http://www.forbes.com/sites/ccap/2016/11/28/price-competition-comes-to-higher-education/#4b75fc9825f7

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The Indicator: Halloween Candy

http://www.bloomberg.com/news/articles/2016-10-28/halloween-candy-sales-are-sending-good-economic-signals

The sales of Halloween Candy has increased greatly showing positive signs for the economy. With the idea that Halloween Candy is a great indicator for the growth of the market. This past year has been a great step towards economic growth. For example, gas prices have lowered. With the idea of this indicator, it demonstrates that consumers are in a better economic state and continue to increase demand due to taste and other demand shifters.

 

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Too many demand not enough supply

Annual sales for Apple iPhone has increased tremendously since the release of the first official iPhone.

This is due to the popularity iPhones receive fro various people and the new changes that apple make to each new phone that is produced. Since the demand for iPhones were extremely high, apple has increased the price for iPhones over the years that got, so high that the demand for the phone decreased, and customers would start to look else were for a phone. Since apple experience they drop of sales it was not expected that the demand for the new edition of the iPhone would be so big, so now apple is facing a shortage due to a high demand of their product and enough supply.

The price for the new iPhone 7 range from $649-$749 due to the difficulties of the new features apple has added to the product. Given this, apple was not expecting to have suck a high demand for this product. Phone companies has requested more of the product given that the demand for the new model was four times as high for the demand of the old models.

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Shifts in Blueberry Supply and Demand

http://www.opb.org/news/article/oregon-blueberry-production-experiencing-unprecedented-growth/

 

The blueberry production in Oregon has increased due to a machine they use to improve picking and packaging efficiency. This innovation has created a berry boom. Recent articles on the health benefits of the fruit have increased the consumers desire to purchase the berries. Their health benefits and recent surpluses have resulted in a high demand for the berries. Supply increased due to the technological innovation which decreased the price but the increase in demand due to the health benefits returned the equilibrium back to normal. Thus the equilibrium price remains relatively equal because even though the consumer demand increased, the invention of the new technology allowing the farmers to keep fulfill the demand.

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Fears Over Zika Drive Demand for Mosquito-Repellent Products


Link:https://www.entrepreneur.com/article/270687

 

Usually, in February, the demand for mosquito-repellents is low. The reason is that because of cold weather, there are less mosquitos.However, this time the expectations (fear of Zika virus) drove the demand up. For some companies, as Invisaband, the increasing demand led to the shortage of mosquito repellents. The company cannot increase supply because its manufacture in China is closed and will not open until mid-February. The producer is only expecting to order twice more product (increase the supply)when the manufacture is opened.

(The article also includes video about the increase in demand for mosquito repellents )


 

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Negative Externalities of Bottled Water

Article: http://www.wsj.com/articles/SB125167502443470973

During the summer of 2009, the sales of bottled water dropped drastically. This was a result of the increase in awareness regarding the detrimenal effects of plastic waste from the bottles on the environment and the possibility of negative health effects on consumers. Consumers learned about the chemicals in the plastics used rubbing off into the water, people ingesting them and having health problems. Consumers also realized how disastrous these one-time use plastic bottles are for the environment. They take up massive amounts of space in landfills take hundreds of years to decompose. This newfound knowledge caused consumers to start using more tap water and reusable water bottles to reduced costs after the 2008 recession and help the environment. As the demand for bottles water decreases, supply curve shifts up and to the left which lowers the amount produced. Using reusable bottles benefits the consumer’s health and pockets, by saving them money and benefits society as a whole by helping reduce the amount of waste entering the environment.

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Election Affects Stock Market

Going into the election, people were thinking that the stock market was going to do poorly so they sold their stocks. However, right now the stock market is booming and is almost at an all time high. Looking at the data from past election day stock markets, it seems that this is a typical pattern. Brokers believe that the stock market doing well is only short run, and will soon go back to breaking even. The stock market is a great example of supply and demand, since the supply is always constant, while the demand always changes. People believed that the demand was going to go down, however the stocks ended up being in higher demand.

 

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The End Of Price Hikes for Pharmaceuticals?

Many drug companies hold monopolies over production of certain medications simply because of patents. However, this Business Insider article shines light on a type of monopoly no one thinks to talk about. Similar to the “You can’t take it with you” effect discussed in class, certain drug companies will excessively raise their prices because they are producing a life saving drug for which there is no substitute. The demand is presumably inelastic, but they also don’t have very large markets in general. Therefore, these “orphan drugs” don’t make the companies which produce them any profit because the market is so small. Since profits aren’t being made, even when patents expire generic drug makers have no signal to enter into the market thus allowing the monopoly to remain. With no true market price these firms feel they can set whatever price they want, thus leading to 5000% increases of prices in some cases. However, they are still subject to demand and while patients who need these drugs will continue to purchase them, the pressure is increasing for these companies to increase their consideration of their consumers. As highlighted in the article, when firms less than ethical prices hikes were exposed, several announced plans to cut prices. Could the end of exorbitant prices for these “orphan drugs’ be headed our way? Is all it takes to increase a company’s ethics is expose their behind the scenes dirty work?

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Why We Should Treat our Teachers Better

Teacher’s salaries have continued to decrease over the past few decades. As a result, becoming a teacher has become significantly less appealing to college graduates. It is much more encouraging to enter a field where you can earn more money from the start. This is frustrating for our education system though because in some schools there aren’t enough teachers for the number of students and in others the teachers are not good teachers. On top of this, we judge our teachers on how their students perform on tests, which is not always the best way to evaluate teachers’ performance. Criticizing our teachers and paying them low salaries is not the way to convince more people to become teachers. It may be worth it to reevaluate how we treat our teachers because the costs to the students’ education are rising higher than we think.

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“US new home sales unexpectedly rise in September”

The sales of homes in the US rose in September. The CNBC article claims that this signals an increase of demand for housing in the US. In our terms, this means that the demand curve for houses has shifted up and to the left. There are not enough houses though, because the supply curve is not as elastic as the demand curve. In effect, there are not quite enough houses being built to match the demand.

Article: http://www.cnbc.com/2016/10/26/new-home-sales-reported-for-september-2016.html

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