me: >> [Note that most of the prices that are falling are "commodity" prices >> that are inelastically supplied and demanded (like those of gasoline, >> fruits, veggies, etc.)
Carrol: > I don't understand this. Is their a typo? It seems to say that both the > supply and the demand for (e.g., fruit) are ineleastic. Or does my poor > eyesight get in my way? I'm saying that as prices of veggies (e.g.) fall, the quantity of veggies supplied does not fall in proportion. That, in a nutshell, is inelastic supply. (the percentage fall in prices > the percentage fall in quantity supplied.) Also, as the price falls, the quantity of veggies demanded does not rise in proportion. That's inelastic demand. (the percentage fall in prices > the percentage rise in quantity demanded.) In this case, a fall in price (due to either a demand shift or a supply shift) causes a fall in the total sales revenues earned by veggie-sellers. If they have any debts, this likely means big trouble. This trouble (bankruptcy, etc.) has hit farmers again and again, helping to explain the concentration and centralization of that industry. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
