Price Mechanism

The market system is the mechanism for allocating scarce resources and thereby encouraging a positive investment climate. The problem of scarcity is common in all economic structures. The economic system of a particular country is the way in which its people, businesses and government make choices. Demand is the amount of a product consumers are willing and able to purchase at any given time. However, supply is the amount of a product that is available at any given time. The following diagram shows the relationship that demand has with supply:

The above diagram shows that where the demand and supply intersects, indicates the quantity which suppliers wish to market equals the quantity which buyers are willing to take. There are many factors that have determined the general increase in global food prices over the last four years. One factor is in late 2006 the unseasonable droughts in many grain-producing countries. The top three wheat producers in the world are, China, India, and the United States respectively. The consequences of drought include diminished crop growth, and the ability to rare livestock.

Also, it causes erosion, which further affects plantations and soil consistency. Without water there can be no irrigation. Irrigation is an artificial application of water to the soil for assisting of the proper, healthy growth of crops. Wildfires are also caused by droughts because of the lack of moisture in the air; they consume all agriculture once formed. Biofuels, a fuel substitute that is derived not from fossil fuels but from biological material maybe another cause of rising food prices. Bio fuels are commonly used in place of gas to power vehicles, to heat houses and even to cook on your stove.

The factor that affects the price of crops here is that Biofuels use crops high in sugar and starch, then fermentation of these crops causes the it to produce ethanol. Ethanol is the substance, which is used for power. So as our world is becoming more eco friendly and aware, our food prices will rise. Oil prices over the last four years have been steadily rising, causing food transport and other agriculture related machinery and treatments to rise also. From the mid 1980s to September 2003, the inflation-adjusted price of a barrel of crude oil on NYMEX (New York Mercantile Exchange) was on average under US$25/barrel.

Then in 2003 it finally rose to US$30/barrel and gradually went up to US$60/barrel in 2005, and skyrocketed to US$147/barrel in 2008. These drastic increases in oil prices have taken their toll on food prices over the past four years. Wheat and grain are said to be relatively inelastic, meaning there is not much range for substituting. So where there is a large change in price there is little or no change in the quantity demanded of that particular good. The elasticity of a product can be measured by the following formula: PED = % change in Quantity Demanded of product change in price of that product World population growth is the latest in factors to affect food prices. The world population has grown from 1. 6 billion in 1900 to an estimated 6. 6 billion today. The increase in population size has mainly been pointed to the developed countries where food prices are subsidized. In these countries, the government subsidize crops, and absorb the extra cost of food so the cost does not affect the consumer. So in reality, the developing and the third world countries are the only ones to suffer from our current food shortage.

Calculate the price
Make an order in advance and get the best price
Pages (550 words)
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Upload your instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with MyStudyWriters
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Business and administrative studies
excellent job thank you Your Score 166.25/ 175- A 1. Current Culture 15% of total grade 18.37 Criterion "1. Current Culture" has textual feedback Criterion Feedback I see interesting points, though, in general they are not about the culture.
Customer 452773, June 4th, 2023
Thank you for your hard work and help.
Customer 452773, February 13th, 2023
Customer 452591, March 18th, 2021
Business and administrative studies
excellent work
Customer 452773, March 12th, 2023
Business and administrative studies
Customer 452773, March 3rd, 2023
Social Work and Human Services
Great work I would love to continue working with this writer thought out the 11 week course.
Customer 452667, May 30th, 2021
Human Resources Management (HRM)
excellent job
Customer 452773, June 25th, 2023
Managerial Accounting & Legal Aspects of Business ACC/543
excellent work
Customer 452773, February 7th, 2024
excellent work
Customer 452773, October 6th, 2023
Business and administrative studies
great job as always
Customer 452773, February 26th, 2023
Customer 452773, March 15th, 2024
Thank you!!! I received my order in record timing.
Customer 452551, February 9th, 2021
Customer reviews in total
Current satisfaction rate
3 pages
Average paper length
Customers referred by a friend
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat

Sometimes it is hard to do all the work on your own

Let us help you get a good grade on your paper. Get professional help and free up your time for more important courses. Let us handle your;

  • Dissertations and Thesis
  • Essays
  • All Assignments

  • Research papers
  • Terms Papers
  • Online Classes
Live ChatWhatsApp