Wednesday, August 17, 2016

Market for Irish Cattle---Change in Quantity Supplied vs Change in Supply

One of the most frustrating things to teach AND learn in a basic microeconomics class is the difference between a change in Quantity Demanded and/or Supply and a change in Demand and/or Supply---whether we move along the respectived curve or the curve shifts entirely in one direction or the other.

This very short article from a website that reports on agricultural issues in Ireland provides a nice example on the supply side to illustrate the difference:
The number of prime cattle slaughtered at Department of Agriculture approved beef export plants has jumped 10% in the space of a week. 
Figures from the Department show that the throughput of young bulls, steers and heifers increased by just over 2,200 head last week compared to the week before. 
Towards the end of last week and into this week, factory buyers were willing to pay an extra 5c/kg on top of the base price in order to secure stock.And this move appears to have worked, as an additional 2,285 cattle were presented for slaughter during the week ending August 14.
Here are some slides that will help explain the difference. Hope it helps!

Monday, August 15, 2016

A supply and demand lesson with agriculture in one snapshot of a webpage...Oh, and I made some graphs too!

A supply and demand lesson with agriculture in one snapshot of a webpage (Morning Ag Clips)

Lower prices are NOT what farmers want to hear!

While not an exhaustive list, there are basically 3 things that can happen with Agricultural policy in the US that can affect the market for corn assuming the condition presented above---(1) buy up the surplus or (2) use subsidies or (3) do nothing.

I put together some slides to illustrate how each policy may affect the market.

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