For the Week 2 Critical Thinking Exercise, you will discuss and provide applicat
ID: 1152150 • Letter: F
Question
For the Week 2 Critical Thinking Exercise, you will discuss and provide application of concepts of supply and demand by identifying two goods and two services you consume at the household or professional level. For each example, you will identify a demand-shifting factor (preferences, expectations, income) and a supply-shifting factor (entrylexist of a producer, cost of input, etc.) Based on each factor/scenario, please discuss the impacts to the equilibrium price and quantity further include actual reporting of the scenario relating impacts on the industry from the scenario- based adjustment from research. For example, for the gasoline industry, a scenario could be civil unrest emerging in Saudi Arabia, since they are the largest exporter of gasoline, this would impede gasoline supply. The reduction in gasoline supply would shift the curve to the left and holding demand constant create a new equilibrium price and quantity. In your response, please research and report actual quantitative information (charts, tables, and graphs) for industry data tied to your example alinkin the **RFPLYExplanation / Answer
The first good that i am consideriing is crude oil for daily personal consumption. The recent industry of crude oil is not in good position. The price of oilis hiking every now and then and even it was in news that OPEC was again talking to limit the supply of the oil. When the supply of oil gets limited then the impact would be as folllows:
The supply reduction would make shift in supply curuve to left side upward this will make new equilibrium from interaction of old demand and new supply which will give new equilibrium output of oil which will be lesser than earlier and also the price will shift upward that is more than earlier.
The second good that i am considering is automobiles. Demand of deisel and petrol consuming automobile in middle income classes are expected to go down. This is because of uprising of electronic automobiles. It has been statistically identified that electronic vehicles could account for significant share of demand of automobiles. This will reduce the demand of deisel and petrol automobiles to which the demand curve will shift downward and new equiilibrium will occur. This equilibrium will result in decrease in price and output of petrol and deisel based automobiles.