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How can price of a commodity impact on the equillibrium price and quantity of another commodity?
The commodities have to be somehow related - the price of lead won't affect the price of oats, or at least we hope it won't.
There are a couple of ways this works.
First consider directly related commodities...we'll say diesel, heating oil and jet fuel. These are essentially the same product, but they go to different users and so are processed differently once the basic fuel is obtained. There's only a certain amount of this fuel, so if they want to make heating oil less expensive in the wintertime or jet fuel less expensive in summer they increase the prices of the other two fuels to discourage their use.
Next consider indirectly related commodities, such as diesel and wheat. It takes a LOT of diesel to produce wheat - you need diesel to plant, fertilize, harvest and transport it. If the price of diesel increases, the price of wheat also increases.
What else can I help you with?
What are the key differences between an inelastic and elastic graph in terms of price and quantity changes?
In an inelastic graph, price changes have a small impact on quantity demanded, while in an elastic graph, price changes have a significant impact on quantity demanded.
How a price of a commodity is determined?
The price of a commodity is determined primarily by the forces of supply and demand in the market. When demand for a commodity increases or when supply decreases, prices tend to rise. Conversely, if supply increases or demand decreases, prices usually fall. Other factors such as production costs, market competition, and external influences like government policies and global events can also impact commodity prices.
What is the impact of a shortage on the equilibrium price and quantity in an economic market?
A shortage in an economic market leads to an increase in the equilibrium price and a decrease in the equilibrium quantity.
What are the key differences between inelastic demand and elastic demand in economics?
In economics, inelastic demand means that changes in price have little impact on the quantity demanded, while elastic demand means that changes in price have a significant impact on the quantity demanded.
What is income effect mean?
The income effect is the change in the individualâ??s income and how it will impact the change in quantity of a service. As the income increases, the quantity of demand of service also increases.
What type of changes can impact the quantity of water?
Heat
What are the key differences between an inelastic and elastic graph in terms of price and quantity changes?
In an inelastic graph, price changes have a small impact on quantity demanded, while in an elastic graph, price changes have a significant impact on quantity demanded.
How a price of a commodity is determined?
The price of a commodity is determined primarily by the forces of supply and demand in the market. When demand for a commodity increases or when supply decreases, prices tend to rise. Conversely, if supply increases or demand decreases, prices usually fall. Other factors such as production costs, market competition, and external influences like government policies and global events can also impact commodity prices.
What is the impact of a shortage on the equilibrium price and quantity in an economic market?
A shortage in an economic market leads to an increase in the equilibrium price and a decrease in the equilibrium quantity.
What are the key differences between inelastic demand and elastic demand in economics?
In economics, inelastic demand means that changes in price have little impact on the quantity demanded, while elastic demand means that changes in price have a significant impact on the quantity demanded.
What is income effect mean?
The income effect is the change in the individualâ??s income and how it will impact the change in quantity of a service. As the income increases, the quantity of demand of service also increases.
What is commodity advantage?
Commodity advantage refers to the competitive edge that a company or country gains by possessing or controlling valuable natural resources or raw materials. This advantage can stem from factors such as abundant supply, lower production costs, or unique geographical conditions that enhance the quality or availability of the commodity. It enables entities to leverage these resources for economic gain, influencing market prices and trade dynamics. Ultimately, commodity advantage can significantly impact a nation's economic development and a firm's profitability.
What is the noun for impact?
The noun for impact is "impact." It refers to the effect or influence that one thing has on another.
What does this quote mean you abuse land because you regard it as a commodity belonging to us When you see land as a community to which you belong you may use it with love and respect?
The quote is talking about view points. Viewing land as a commodity or possession creates the mindset of getting what one wants from it regardless of impact or consequence. Short term benefits, go along with short sighted views. Seeing the land as a whole, that supports your very life, the individual can see how small changes impact it, and in turn impact the individual and community.
What is the most consumed commodity in the world and how does its consumption impact global economies and environments?
The most consumed commodity in the world is oil. Its consumption impacts global economies by influencing prices, trade balances, and economic growth. Oil consumption also affects the environment through pollution, climate change, and habitat destruction.
Which quantity in the equation will most likely be the smallest?
The smallest quantity in an equation is likely to be the coefficient of the variable with the highest degree. This is because the variable with the highest degree will have the most significant impact on the value of the overall expression.
What is the impact of a price floor on a market?
If the price floor is above market equilibrium then companies are forced to sell at that price. This means the market's quantity supplied and quantity demanded will not equal each other, resulting in a surplus.
