Please write down using theories and concepts learned in Macroeconomics to explain a real-life economic situation.

An exampleis included as below:

During the past year and in particular recently, I found prices in Canada, and more specificallyfood prices, have been risingquite fast. Based on what I learned in Macroeconomics this semester, I can explain that by the following:

An exampleis included as below:

Food prices have increased even more than general prices since foods are non-durable goods. We learned non-durable goods consumption generally does not drop much even in a recession such as the one we are in right now. (chapter 6). Therefore, the demand ofnon-durable goodssuch as food remains high while the demand ofdurable goodssuch as cars and computers will drop dramatically during a recession. Therefore, the increase in the price of food far exceeds the increase in the price of cars and computers.