http://news.sky.com/skynews/Home/Business/Cotton-Price-Cost-Hike-Could-Mean-End-Of-Cheap-Clothing-As-Bargain-Chains-Raise-Shop-Prices/Article/201009415743868
As a commodity, cotton is demanded in very large quantities. Although the total QD may rise slowly over time, this wouldn't noticeable shift the demand curve. The curve itself is very steep (inelastic to us the correct term - the next chapter of the book).
1. Describe what would happen to price if the quantity supplied fell by 50%
2. Then what would happen with a 50% rise. (Draw the diagram).
3. Open question: are higher cotton prices fair?
The market price in these commodities have the potential to be VOLATILE when there is a disruption.
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