Short supply + high demand = high prices.
Large supply + low demand = low prices.
I know that most of you who were complaining about the high price of gas are liberal democrats who "grad-ee-eated" from a government sanctioned child abuse indoctrination center (public school). I also know that my 7 yr. old grandson probably understands more about economics than you do. Anyway, ARE YOU BEGINNING TO UNDERSTAND BASIC ECONOMICS 101?
2006-09-13 02:16:16 · 18 answers · asked by Anonymous in Politics & Government ➔ Other - Politics & Government
Well said! I got shouted out of a discussion on this very thing! Let them sit on their gas. People should reduce the amount of driving they do and see what happens then!
2006-09-13 02:21:55 · answer #1 · answered by Anonymous · 1⤊ 1⤋
Well, as I hold both an economics degree and an English degree, let me try to explain two things to you.
1) Yes supply and demand do affect the price of a good or service. Do not forget, however, that true supply and demand function only in an open, pure market. An open, pure market is a false, made up world used to explain supply and demand to students. Economics also teaches that people make decisions in the market after they have all the information available on a subject (right - I see that, oh, NEVER).
Economics also explains that outside factors can affect pure supply and demand and manipulate prices. Perhaps you missed the part about supply shocks (real or made up), monopolies, oligopolies, false information entering the market; or a simulated market created by government policy.
2) Why simple supply and demand don't work here:
a) Gore v. Bush 2000. Gas prices jump for no reason. Bush claims its due to Clinton administration lack of energy policy. Gore suffers in the polls.
b) Bush gets elected in 2000. Gas prices miraculously drop. Bush administration grants drilling rights to oil companies in US preserves.
c) Bush administration goes into Iraq. Prices jump, but administration says, sorry, nothing we can do about it.
d) 2006 Bush administration sees GOP candidates, weeks from elections, are in a tough fight with the public. Although gas prices had continued to rise through 2006, they miraculously drop, for no reason, just as elections near.
Bush/GOP are either the luckiest sobs on the planet or Bush buddies from the Texas oil fields (where was he governor again) help them out ever so much every time they need it.
No one is that lucky (another part of an econ. degree was probablility theory).
2006-09-13 02:35:55 · answer #2 · answered by J T 3 · 3⤊ 1⤋
Since some of you who answer cannot understand why gas prices have fallen so steeply, here is why:
1. The prices rose dramatically when MTBE was no longer used and ethanol took its place. Since the market was not ready to fill the demand, prices skyrocketed. Also take into account that the summer is peak driving.
2. The oil business is more complicated than a few people can manipulate prices. The government taxes gas at a variable rate at the state level. As prices go down, so does the amount in taxes. When prices fall, they will fall faster when at higher prices. Gas has fallen about 15%. This is a better gauge than cents per gallon.
2006-09-13 02:57:25 · answer #3 · answered by Chainsaw 6 · 0⤊ 1⤋
Exactly. We are going into the winter season which means exactly what you stated up above, supply is up demand is down. Also many people do not know this but retailers switch to the winter grade fuel during this time of year which is about 2 cents a gallon less. Also with the Alaskan Pipeline problem expected to be resoved in October bringing it 100% online we will see even more drops in our gas prices. Anyway, great post!
2006-09-13 02:53:01 · answer #4 · answered by fire_side_2003 5 · 2⤊ 0⤋
An economic analysis would include factors that affect supply and demand. These would include US policy in the Middle East, tax incentives and burdens on oil producers and refiners, and purchases for the strategic oil reserve. In other words, US government policies affect both the supply and demand, and thus the price of gas. There are other reasons, but government policies and actions are a significant determinant of the price we pay.
2006-09-13 02:25:00 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Over the last 18 months gas prices have risen following disaster after disaster. Nothing has happened in quite some time, so its time for the oil companies to allign their prices.
I believe the real reason that prices are rolling back is that the oil vendors, who have been making all the profit, fear that once democrats take the House in November they will be facing congressional hearings about the profits that the oil companies have managed to rack up in the last two years.
Couple the scaling back inflated profits with the seasonal decrease and you get price drops of 50 cents a gallon.
2006-09-13 02:29:10 · answer #6 · answered by Anonymous · 2⤊ 2⤋
who is the one that should take economics???
Price of barrels of oil is based on PROJECTIONS NOT SUPPLY AND DEMAND. The oil was prices at over 70 dollars a barrel because of a bad prediction of a hurricane season in the US, and the because the US is unstable, and because of war in the middle east.
Gas prices are set not just by people in the US but by people all over the world buying. Have the prices gone down everywhere? yes.. why? becuase the price of crude oil has dropped. So by your logic, everyone in the world is using less gas?? I think not.
Maybe you should stop taking economic lessons from a seven year old.
DAYUM.. i just TOLD YOU!
2006-09-13 02:31:50 · answer #7 · answered by psychstudent 5 · 2⤊ 1⤋
gasoline expenses are often by no ability the president's fault.no longer even Obamas.The countries administration the fees of the oil,and it could selection dramatically.i do no longer possibly blame Saudi Arabia and others others for needing intense expenses.I mean we use extra beneficial than we produce,and that they artwork no longer trouble-free on it for us.In inner maximum enterprise the cost might boost under those self same circumstances to boot.to respond to your question from my perfect answer:specific I actual have seen The Obama Deception.i might wager the actually reason Bush became into blamed became into biased media.Fox often assaults Obama further, it is the reason I watch BBC often over American media.They criticize whoever does a foul activity,no longer sugar coat to a minimum of one.
2016-12-12 07:40:21 · answer #8 · answered by ? 4 · 0⤊ 0⤋
No please tell us basic economics 101.
Don't you find it curious that the gas prices started declining right around the corner from election day? Repubs have taken a hug hit on the soaring gas prices (because they failed to do anything about it) in the recent months (and past year).
I like how most ppl don't see a strategically placed PR stunt as transparent as this. Just watch as soon as the election day has passed, the gas prices will start to rise...and the reason will be:
1. hurricane
2. mid-east crisis
3. iran and iraq conflict
2006-09-13 02:21:22 · answer #9 · answered by The First 3 · 1⤊ 2⤋
How I love your simple logic. But here's another: if a government reduces taxes on gas, the price will not go up as far. Compare petrol prices between the UK and the US for example - in your country oil costs but a fraction of what it does here, because in the UK taxes on it are steep, while in the US oil is practically subsidised. When democrats ask the Bush government to do something about the increasing gas prices, they might ask for him to lower taxes on it and thus reduce the effect of 'short supply, high demand'.
2006-09-13 02:20:54 · answer #10 · answered by McAtterie 6 · 2⤊ 4⤋