Micro-Economics
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Raising the floor

Raising the floor | Micro-Economics | Scoop.it
HE LIKES the work; but at $9.60 an hour, stacking the shelves at a Walmart in east Los Angeles does not pay Anthony Goytia enough to cover the bills for his family...
Rory Watson's insight:

Minimum wages are an ongoing issue in many countries. In the USA, there is a federal minimum wage, but every state can decide to use the federal wage, make their own wage either higher or lower, or have no minimum wage at all. Higher minimum wage will cause unemployment due to companies' cost of production rising, meaning they will inevitably cut costs which may be workers.

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France's 75% tax rate gets approval

France's 75% tax rate gets approval | Micro-Economics | Scoop.it
Rory Watson's insight:

France has tweaked its 75% so that it is now constitutional, but as the tax is so high, thos affected (earning over £830,000) may actually find work elsewhere, especially football players as there are many other countries which will pay them to play there. This tax is meant to raise money for the French government, but it may well end up making them lose money if too many high-earners emigrate. Furthermore, a 'large majority' in france support this tax, but I wonder how many of them will actually be paying the tax when it's introduced

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Black pepper prices turn hot on tight supply, high demand

Black pepper prices turn hot on tight supply, high demand | Micro-Economics | Scoop.it
KOCHI: Black pepper prices are inching towards the historic Rs 500 per kg mark in the spot market spurred by tight arrivals and good domestic demand. The garbled variety is selling at Rs 486 per kg...
Rory Watson's insight:

Low supply and high demand is raising the price of pepper in Kochi, India, as the supply curve has shifted inwards, and the demand curve has shifted outwards, leading to a large price rise as the equilibrium has shifted up. Furthermore, the confiscation of a large amount of peper has led the supply curve to shift even more inwards, raising prices further.

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The challenges of boosting Tanzania's rice production

The challenges of boosting Tanzania's rice production | Micro-Economics | Scoop.it
Rory Watson's insight:

Africa's population as a whole is booming, and Tanzania is just one example. Due to this boom in population, food production must increase to meet the rising demand from the expanding population. In effect the demand curve is constantly shifting out, and the supply curve, which is very inelastic, is struggling to shif out to compensate for the rising demand.

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Chocolate shortages loom as demand soars

Chocolate shortages loom as demand soars | Micro-Economics | Scoop.it
Cocoa experts work to solve problems of low production as more people demand chocolate treats.
Rory Watson's insight:

Rising demand is shifting the demand curve out every year, but supply has stayed the same over the same period, so the supply curve is very steep, which has caused the equilibrium to move upwards but not too far to the right. Mars hopes to increase the productivity of cocoa bean farms so that the supply curve can shift outwards to counter-act the annual increase in demand for cocoa beans.

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Boom Times in Bowling Green: Corvette Demand Outweighs Supply

Boom Times in Bowling Green: Corvette Demand Outweighs Supply | Micro-Economics | Scoop.it
Customers are beating down Chevy dealers’ doors, checkbooks at the ready, itching for a new Corvette Stingray like Badger and Skinny Pete ache for Heisenberg’s Blue Sky, but Chevrolet isn’t about to add a second shift at the sports car’s dedicated...
Rory Watson's insight:

Demand far greater than supply, and no shift in the supply curve to meet the high demand as they will not increase production. Chevrolet could raise their prices without having excess supply to raise their producer surplus, and lower their price later when demand starts to fall so that they maximise their profits without being seen to price discriminate.

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