Increased Price in Wheat

The price of wheat has been increasing for the first time in two years in Namibia, and this causes a problem for many people as a lot of products uses wheat as its main ingredient. Because the price of wheat goes up, the quantity of supply that the producers make will decrease as they do not have enough money to buy the expensive wheat.

Now as you can see in Figure 1, the supply curve shifts from D1 to D2, which is a leftward shift. This means that the supplies can only offer a smaller quantity, and that they want a higher minimum price.

This entry was posted in Economics, Section 2. Bookmark the permalink.

2 Responses to Increased Price in Wheat

  1. 12fukaty says:

    I know Dr. Anthony said that you don’t need to include Ps and Qs, but I think it would help with comprehension of what exactly is going on. Especially when you refer to the diagram in your explanation.

  2. Peter Anthony says:

    Your analysis is correct but you have made a fatal mistake in your diagram, can you see it?

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s