INTRODUCTION In this assessment report I’m going to uses demands and supply principles to analyses the fruit and vegetable price soured that was caused by the floods. The heavy rainfall and flooding began to threaten Queensland in the early 2011, cyclone called Ways made the fooling even more badly in north Queensland coast. This heavy rain caused huge direct and indirect economic lost in Queensland. The economic impacts of the cyclone Ways and flood to the agriculture sector were estimated to be a $1. 6 billion loss including crop damage, delays or disruptions of arrives and transport delays (Queensland floods: the economic impacts, 2011).
In the first quarter of 2011, the price of fruit went up 14. 5% on average, including banana’s price had been doubled. At the same time, vegetable price increased 16% because of the damages to the crops (Australian Bureau of statistics, 2011). DEMAND AND SUPPLY Demand and supply are the forces of the market economy. It determines the quantity of each product and its price (Manama, 2006). There are two groups of people that are involved in the competitive market activities, those people are buyers and sellers. In the case of Queensland fruits and vegetables market, many sells and buyers were involved in the market.
In this market the fruits and vegetables are not the same prices, but the buyers will around and compare each sellers price in order to get a good price. Therefore the sellers have limited control on their product’s price, if their price is too expensive, fear buyers are willing to pay for product. SSL Original supply curve IQ Price ($) Quantity of demand for fruits and vegetable MARKET SUPPLY FOR FRUITS AND VEGETABLES The supply and demand together are what determines the price and quantity f the goods sold, There are several factors that affect the quantity of supply. We have the price, the input price, technology and expectation.
In the case of Queensland fruit and vegetable market supply, the supply was reduced because of the floods. The cyclone Ways and flood event in Queensland shifted the supply curve to the right. 14% of the fruit and vegetable supply in Queensland came from the flood affected areas (Queensland floods 2012). The harvests of vegetable like pumpkins, avocados, tomatoes, lettuce, capsicum, zucchini, broccoli and celery and tropical fruit such as watermelons, grapes and bananas ere damaged. It is estimated that in 2010-2011, the decline of supply was 10%, which was accounted a loss of $561 million (Stone, 2011).
Therefore, the flood has greatly reduced the quantity of fruit and vegetable supply, which has shifted the supply curve from SSL to SO. The price of fruits and vegetables was doubled in Brisbane Market (MacDonald and Williams, 2011). The market price moved from Pl to UP as shown on supply curve above. Q 24 c Quantity for fruits and vegetables demanded MARKET DEMANDS FOR FRUITS AND VEGETABLES As started by Manama (2006), the product price, income of the individual, price of he related good and individual tastes and expectation determine the quantity of product that is demanded by the individual. The market demand is the SSL.
Jam of all the individual demand. As the price of the goods varies, the quantity of demand will varies. In case of Queensland flood and cyclone Ways, After fall in market demands for fruits and vegetables , Consumers were able to afford fewer fruits and vegetables . This caused a huge shift to the left in demand market curve for fruits and vegetables, The consumers were forced to switched their choice of ruts and vegetable to make changes on their diets due to the rose of fruits and vegetables prices which shifted demand curve from Del to DO and price rose form P Tit UP as shown on market demand curve above (Militia, 2011).
MARKET DEMAND FOR BANANAS Price of bananas ($ per keg) 12 36 2 3 4 Quantity of bananas demanded per keg In this diagram above, we have demand curve for bananas. A demand curve measures the quantity of goods or service demanded by consumers in relation to changes in the price of that good or service ,every individual will have their own unique emend curve for each goods or services as consumers have unique tasters and other different Slogan, Norris & Garrett ( 2010). In 201 1 cyclone ways destroyed worth of bananas in Queensland and dramatically reduced the supply of bananas throughout Australia (Australian Bureau of Statistics 2011). Et use the price of the bananas as an example of Queensland flood and cyclone. At every given price the consumers were able to afford more bananas . The market demand curve for bananas, After the flood and cyclone Ways , there were huge movement along the curve for the market demand of bananas, resulting in prices hat were more than double the usual price, Demand curve for bananas moved from A to B . At the price of $8, consumers were able to afford egg for bananas, after demand curve moved to point B, the consumers were able to afford egg for $36.