Economics of Cyclone Yasi

The article that I had chosen is about the Australian banana's industry, which escaped flood damage, reports experiencing confiscation due to the tropical Cyclone Yasi. During this cruel disaster happened in February 2011, which is Cyclone Yasi, this banana industry had been seriously hit. According to ABGC Chairman Cameron Mackay, it states that, "the banana planters across Far North Queensland, in regions of Innisfail and Tully have been the most seriously affected by the Cyclone Yasi". In the major growing areas of Tully and Innisfail, which supplied more than 3 quarters of nation-state's banana were destroyed all the banana plants.

In a general, supply and demand is likely to be one ...

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between price and how much good or services supplied to the market known as the supply relationship. Price, therefore, is a reflection of supply and demand. So in the short term period, the impact will more likely a massive hikes in banana price. This can be illustrating by a graph below:

From the graph above, at the point of equilibrium of point E0, which intersect with the point D0 and S0, the banana industry in is original. Because of the natural disaster, Cyclone Yasi, that had been destroyed all the banana plants in the main growing area, the supply had been seriously hit. The supply shifted to the left, from S0 to S1 as we can see at the above graph. Automatically, the quantity of banana is decreased from Q0 to Q1. If we assume the price is constant. The new equilibrium occurs at point E1, price rise from P0 to P1.

Moreover, if the bananas allowed to be imported into the Australia, the short-term impact on the market will be the price of banana. Banana sold in a ...

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This will be when the price falls to the point where the demand curve for the firms just touches the bottom of the long term average cost curve or lower. Q2 is the output of the long-term equilibrium of the firm with P1, the average price over the long term. Consider the situation where the firm has undergone a loss. In the long run, some firms will leave the industry because it is an ineffective carrying on the production in the long-term loss. If the firms leave the industry, the total supply will decrease. The greater the number of the firms that leave the industry, the greater drop in supply and greater will be increase the price of product itself. Firms will continue to leave ...

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PAPER DETAILS
Added: 9/27/2017 07:01:24 AM
Submitted By: YeezySeason808
Category: Economics
Type: Premium Paper
Words: 1423
Pages: 6

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