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Spreadsheet Analysis of Demand and Supply for Sunbest Orange Juice
Transcript of Spreadsheet Analysis of Demand and Supply for Sunbest Orange Juice
The Supply and Demand
Functions Economic Assumptions
on the Demand Economic Assumptions
on the Supply Economic Assumptions
Surplus or Shortage An Analysis
Beyond the Case Presented by Jingshan Dong, Chalina Howell, Ahmed Nassef, and Xi Wu Three Situations: All factors changing
Change in Price Only
Change in Temperature Only All Factors Price Temperature Three Situations: All factors changing
Change in Price Only
Change in Temperature Only All Factors Price Temperature Price on Supply on Demand Temperature on Supply & Demand Price on Surplus & Shortage Temperature on
Surplus & Shortage Purpose of
Spreadsheet Analysis Studying the Demand and Supply Effects of Possible Changes to Exogenous & Endogenous Variables (e.g. weather, comp. advertising and pricing, etc...) Pro & Con Pro: Results allow for adjustments to be made for efficiency of Supply & Demand
Con: Tedious to discover marginal effects of wide range supply & demand In the Case of Sunbest Demand and Supply are highly receptive to changes in weather
During hot summer months, demand for Sunbest Juice grows
On the contrary, hot, dry weather reduces supply of orange crops Demand Function Supply Function Qd = 1,000,000 - 25,000,000P + 10,000,000Ps + 1,600Y + 50,000T Qs = 8,000,000P - 100,000Pl - 120,000Pk - 150,000T Qd= Quantity Demanded
P= Price of Sunbest
Ps= Price of Soda
T= Temperature Qs= Price of Sunbest
Pl= Price of Labor
Pk= Cost of Capital
T= Temperature Spreadsheet Analysis of Demand and Supply for Sunbest Orange Juice Presented by Jingshan Dong, Chalina Howell, Ahmed Nassef, and Xi Wu Thank you for listening!
Questions? Why do price and temperature have an inverse impact on surplus vs. shortage? Are demand and supply more sensitive to the changes in the price of Sunbest or to the changes in temperature?