Minimum wage

As a member of the working demographic affected by market equilibrium issues, I believe that minimum wage should stay the same.  If we raise it then it will cause a massive increase in unemployment because business owners will have to cut a lot of their employees.  It could create a better life for those that keep their jobs and are able to work through it, but it would also send all of the other people who lost their jobs even more into poverty.

Price ceilings

I disagree with having price ceilings in our economy because it creates a shortage of products. This can lead to a black market and cause a lot of problems.  Many suppliers would shut down and try to find other products worth selling to make more profit, while consumers would buy it at store price and re sell it for more due to the shortages of that product.

Price floor

I agree with having price floors in our economy for certain products such as alcohol or other related products.  This will either cause a decrease in consumption or it will help the economy dramatically.A decrease in consumption would effect a lot of things such as less drunk driving, less under age drinking, and many other health issues. It could also help with our economy if people are unwilling to drink less frequently then our country will be making a lot of money.  Even with a price floor, that doesn't mean an unrealistic price where no one would buy it.

Supply Wrap Up

Demand Reflection

In my life I never noticed how many products I bought to compliment another product. It never occured to me that stores and business owners are trying to get you to do that. My family goes shopping all the time and we buy certain things to compliment other things such as chips and salsa. When we go down the chips aisle and grab a bag of tostitos, we aslo grab a container of salsa. Which, just so happened to be conveniently placed right there.
When I was a little kid I wanted a skateboard really bad so we went to the store to buy one, but when we got home I had a lot more stuff than planned. All of the complimentary products that I had to buy with it were also there.  I ended up buying a helmet and pads, and some extra wheels. Complimentary products are in our everyday lives and sometimes we dont even notice.

I wonder how big companies end up becoming compliments with other products.

Demand Wrap Up

 

Inelastic vs. Elastic

Demand schedule and graph

Demand headlines

Substitute demand - "Plane tickets triple in price, demand for train tickets Soar"
Complementary demand - "The fourth is less than a day away and barbecue items are flying off the shelves"
 Elastic demand - "Dr.Pepper prices drop, Consumers stock up"
Inelastic demand - "Oil spill goes straight to the pump, consumers not happy"

Last week one of the biggest oil companies in the U.S. had a major oil spill. The captain opf the ship was heavily intoxicated and didnt notice a giant rock that the ship was heading towards and cost them millions. The company is now also being sued because of previous oil spills. Gas prices jumped one dollar in the last two days and are still increasing.  With the gas prices going up consumers are converting to riding their bike to work, but with Oregon rain on its way consumers are getting frustrated. This company needs to do some self evaluating if they want to get back to the top.