How Hurricane Katrina effect gas prices Outrageous gasoline prices is something that all American face at the pump in today economy. Many American wonder what is the cause of the high rates at the pump. There are many factors involved in the answer to the question on what causes gasoline prices to increase suddenly. In 2005, Labor Day Weekend gas prices rose dramatically after hurricane Katrina hit the southern coast of the United States. The devastation of hurricane Katrina damaged many of the United States oil refineries, causing a decrease in crude oil supply, which caused a decrease in gasoline supply.
British coal exports were more costly, this again led to mine owners wanting wage cuts and longer working hours, however these were rejected, this lead to multiple threats of a lockout, were the miners wouldn’t get paid al all as the were not allowed to work. The government then decided to pay the miners and mine owner’s subsidies to stop the working disputes for 9 months. After the Samuel commission was done, both miners and mine owners disagreed with the parts of it and when the government subsidies ended, the mine owners and the unions tried to negotiate a deal, the terms of the deal were later rejected by the miners. As the terms of the deal were rejected, May 1926 miners were then locked out of the mine by the mine owners, but a lot of the trade unions supported the miners, aswell those of the triple alliance. The lockout was bad for the miners because they now didn’t get any
This could be the opposite and McDonalds will then have low availability and high cost. This means that people spend less and there is a lower demand for goods and services. There will be a decrease in sales revenue and they will also have fewer opportunities to invest in new restaurants. The base rate interest rates have an effect upon the cost of borrowing. The higher the rate the more expensive borrowing would be.
In the demand side, Methanex’s revenue was exposed to the fluctuation of the demand for methanol, since Methanex only produced methanol. This situation was more serious in the supply side, where the price the “raw material”, natural gas was subject to fluctuating prices, interruptions to supply lines and international policies and regulations governing imports and exports. In last decades, some plants in New Zealand and Egypt had to shut down temporally for fluctuating price of natural gas or political issues. The options for Methanex to solve/relieve these issues include: • Using derivatives on natural gas and methanol to hedge the risk from price fluctuation • Expanding the market in China to explore opportunities in both demand and supply sides • Exploring opportunities in areas where long-term contacts on demand (in methanol) or supply (in natural gas) instead of focusing only on the richness in natural gas reserve • Expanding new products lines to reduce the risk from strongly relying on a single product. It could also make use of the idle resources (plants, machines, etc.)
As stated in extract 1, it tells us that the goods we import are not made in the UK and so makes it impossible to replace the imports, therefore meaning that we still have to import goods, despite the high prices due to the low exchange rate of sterling. This is partnered with the fact that some suppliers (shown in extract 1) have agreed long term supply contract with cheaper overseas suppliers before the depreciation of the sterling and so they are now paying high prices. This may mean that these suppliers may have to increase the prices of these goods, therefore leading to cost push inflation due to trying to maintain a decent profit margin in the hope the demand for the good does not drop dramatically. However, it is stated that there still may be a large price differential with countries such as China and India, even after sterling's depreciation. On the other hand however, as stated in extract 1, line 8, volume of good imported has also increased by 16% and inflation has continued well above target.
It varies among products because some products may be more essential to the consumer. Products that are necessities or ‘need’ are more insensitive to price changes because no matter what happen, consumers would continue buying these products despite prices increases, even though, consumers might buy less, but overall, it’s least affected by these changes compared to the products that may not be necessary in daily life. Elasticity of demand for Californians for reduction in price from: I. £18 to £16 Price elasticity = %
This would increase the costs and result in the firms passing on the costs to the consumers, this would increase the prices of the goods causing negative externalities and discourage them from being bought. If there is an over production in the goods due to negative externalities, it means (s) has shifted to (s1). Which results in too many goods being supplied out to the public. The prices are also very low which makes it easier for them to buy goods, especially those with lower income. At the point the social cost [s1] is not taken into account only the private cost is.
It might be acceptable from their point of view for this reasoning. Do to the fact, if they suffer losses, they may have to shut down their business. This in turn will lead to fewer jobs, reduced competition and even higher gas prices. This is why gas is the price it is now. Question 15, Chapter
Therefore, company A needs to stop making this product. Although we can argue that if company A could reduce the cost dramatically, it can become profitable. However, as the demand of its headphones is shrinking and there are so many suppliers (due to low barrier of entry), there will be great price pressure on the product, as explained by William F. Samuelson and Stephen G. Marks (2010). The price reduction may over shallow the possible cost reduction the firm could achieve. Susan Schreter’s second step is to target new customers from within groups.
As the Dutch cluster uses greenhouses for its production, and greenhouses need gas, the cluster is sensitive to the gas price variation. The last few years have seen a significant increase of gas prices that makes the cluster less competitive compare to others, which are not dependant on greenhouses. As we said before there is also the decrease in auction participation. Some independent part of the process stay desire, logistic for example, but the whole process does not arouse much interest. Compare to other clusters that deal with split cost challenge, the Dutch clusters became less competitive due to higher costs.