Sunday, October 11, 2009

SUGAR

a) one factor is heavy rains, another factor is a dismal monsoon season in India (the biggest consumer of sugar).

b) demand for sugar has grown and it is still growing.

c) 

d) price elasticity of supply shows how supply responds to changes in prices. formula: %changes quantity supplied / % changes in price.

e)the price elasticity of supply will be  inelastic .

f) price elasticity of demand shows how demand responds to changes in prices. formula: %changes quantity demanded / % changes in price.

g) I think that demand for sugar is inelastic, because a lot of people do like sugar and there are not a lot substitutes of sugar.

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