For each of the following articles below, analyze the impact of a change in demand or a

change in supply or both (or it may not necessarily illustrate a change) on price (equilibrium

price, market price) for the good under consideration and draw the appropriate graph for

each article. Use D 1 , S 1 , P 1 , and Q 1 to symbolize initial demand, supply, equilibrium price and

quantity respectively. Use D 2 , S 2 , P 2 , and Q 2 to represent the new demand, supply,

equilibrium price and quantity respectively. (5 points each item)

1. Asia import monoethylene glycol (MEG) prices weakened this week amid falling

polyester sales, and the market will be likely under pressure as downstream demand

may slow gradually amid a second wave of coronavirus infections in overseas markets.

(ICIS, October 29, 2020)

2. Even before the pandemic, there were signs that global food prices could soon surge.

Extreme weather events induced by climate change have become more common.

African swine fever wiped out over one-quarter of the world's pig population last year,

causing food prices in China to increase by 15-22%year-on-year so far in 2020. And,

more recently, the worst locust blight in 70 yearshas destroyed crops in East Africa. In

Kenya, the price of maize, a staple food, has risen by over 60% since 2019.

3. Monthly average crude oil prices plunged 50% between January and March. Prices

reached an historic low in April with some benchmarks trading at negative levels. They

are expected to average $35 per barrel in 2020, a sharp downward revision from the

October forecast and a 43% drop from the 2019 average of $61 per barrel. The

downward revision reflects an historically large drop in demand. The decline in crude oil

prices has been exacerbated by uncertainty around production agreements among the

Organization of the Petroleum Exporting Countries (OPEC) and other oil producers.

(WB, April 23, 2020)

4. Metal prices also fell in early 2020. The biggest declines were in copper and zinc, which

are particularly associated with global economic activity. Metal prices are projected to

drop 13% overall in 2020 as slowing demand and the shutdown of key industries weigh

heavily on the market. (WB, April 23, 2020)

5. Slaughter rates dropped in 2019 because of low farm gate prices and weak pork

demand, which contributed to a decline in 2019 swine meat production. (pig333.com,

March 26, 2020)

6. The Department of Energy announced Sunday evening that there is a 15-day price

freeze for household LPG and kerosene in the entire province of Cavite after the local

government placed the province under state of calamity due to Super Typhoon Rolly.

(Phil. News Agency, Nov. 2, 2020)