Demand and Supply

S1 Price Question 1 Supply sound out of spirit The state of nature includes every innate(p) force that will diverge production such as weather and natural disasters. This means usually affects the agriculture orbit (Parkin 2010, p. 66). out-of-pocket to La Nina depression which is a natural disaster, in that respect were fertilizer cuts and turn over shortage. This will ca put on supply erupt to shift to the left. Number of suppliers The larger the number of firms supplying a good, the larger the supply of a good and sin versa (Vengedasalam, Madhavan & Kamaruddin 2008, p. 47). As stated in the article, only Malaysia and Indonesia are the main contend veget adequate to(p) oil exporter to the whole world. This means that the world bank greatly on these two countries. So, the number of suppliers is very a couple of(prenominal) and in brief it will not be able to cater for the development global demand. Therefore, supply curve shifts left. State of engi ne room An improvement of engineering science increases productivity and reduces cost (Worthington, Britton& Rees 2005, p.135). The article states that Malaysia had been facing declining output for two consecutive years coupled with poor fresh harvest-festival branches due to labour shortage, check replanting and unsatisfactory yields. This is because Malaysia does not use the most advance technology to obtain palm oil.

If the plain is more technology efficient, it would not be affected greatly by labor shortage. Hence, freshly technology for soil plate would help Malaysia to increase its yields by many folds. Demand Expectations of future outlays ! If consumers conceive that the future price of a good will increase, the true demand of a good will increase and vice versa ( Vengedasalam, Madhavan & Kamaruddin 2008, p. 35).The article clearly states that the global demand for palm oil is increasing cursorily but the suppliers like Indonesia and Malaysia are finding it tough to distribute with the demand. It means that currently, demand is more than supply. Due to this shortage, the suppliers will increase the price...If you want to get a wide-eyed essay, order it on our website: BestEssayCheap.com

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