Explain how lower oil and gas prices affect how much money people have? What group of people is this most benefiting? How long are these prices supposed to last? How is this an example of supply and demand?
Please read article and answer all components of the prompt using contextual evidence.
Explain how lower oil and gas prices affect how much money people have? What group of people is this most benefiting? How long are these prices supposed to last? How is this an example of supply and demand?
10 Comments
Maggy
5/5/2016 09:48:47 am
~“When oil prices fall, the benefit to consumers outweighs the loss to producers,” said Dean Maki, chief United States economist at Barclays. “Investment in oil and gas production is still less than 1 percent of gross domestic product. Consumer spending is 68.5 percent of G.D.P.”(Sliding Oil and Gas Prices Give Americans More Money to Spend, Nov 14, 2014) This benefits mostly to middle-class americans. Prices are supposed to stay until the price tapers off at $70 which probably means low production. This is supply and demand because it is meeting its need and almost a surplus to the prices went down.
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Jake Sandrey
5/5/2016 09:52:27 am
Lower oil and gas prices affect how much money people have because the lower those prices are the more money people have to spend on other useful things. This event is benefitting the low-and middle-income Americans the most. These prices are mostly likely going to last for at least a year and maybe even longer. This is an example of supply and demand because as the price goes down demand goes up.
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Nickole Smith
5/6/2016 08:52:46 am
Lower oil and gas prices effect people's money by the more money you have the less you spend on gas and it doesn't hurt you every time. “When oil prices fall, the benefit to consumers outweighs the loss to producers,” said Dean Maki, chief United States economist at Barclays." The people who are mostly benefiting is the consumers 'cause when the price is low they can get more gas in their car.
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Sophie
5/9/2016 09:12:40 am
Lower oil and gas prices affects how much money people have because they are spending less money on gas annually and also spending less money to heat their houses in the winter, which gives them more money to spend elsewhere. "...If prices fall to the level Mr. Kloza predicts and stay there, that adds up to a yearly savings per household of at least $400. A 15 percent drop in the cost of home heating oil since last winter..."
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Carl Heide
5/9/2016 09:55:45 am
The lower the gas and oil prices are the more money people will have because they will not be spending as much on gas. The author says “that consumers will roughly save $8.4 billion in November and December”. The lower gas and oil prices most benefits the low and middle income americans. The author says that “the low and middle income americans have been largely left behind by the anemic economic recovery that began in the middle of 2009”. These prices are going to last at least a year said Edward L. Morse. This is an example of supply and demand because as the prices goes down the more demand there will be but the supply the companies make will be less because they do not have as much of an incentive to sell it because it’s cheaper.
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Jenny Brewer
5/10/2016 09:04:30 am
With the lower oil and gas prices, people would be able to spend more money on goods and services rather than spending money on how they will get to those locations. Barclays mentioned, "The extra cash in shoppers’ wallets and pocketbooks could help generate nearly half a percentage point in added economic growth in the fourth quarter, and roughly $70 billion more in consumer spending over the next year." The low and middle income Americans are seeing the greatest impact since the 2009 anemic recovery. Edward L. Morse made the assumption of the low prices of oil and gas lasting around a year and stated that as the prices shift it would take more demand to get back to how prices were in the 90's. Relating to supply and demand, the low prices of oil and gas are at a high supply making the prices so low but as the demand increases so will the prices once again.
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Chad Winkler
5/11/2016 08:50:40 am
When gas prices are lower, people don´t have to spend as much money on gas, and so they have more leftover for other things. Consumers are currently the biggest beneficiaries of these low prices. While some say this trend cannot last, Edward L. Morse, global head of commodities research at Citigroup says: “We think lower gas prices in the U.S. are going to last for at least a year.” This is great example of supply and demand. Saudi Arabia is producing so much oil, that there is more than enough to go around. Because of this, no one is willing to pay super high prices like they usually are, because they don´t have to compete with everyone else over who gets gas and who doesn´t.
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Collin J
5/11/2016 09:06:46 am
A drop in oil and gas prices, like the one America has experienced recently, leaves more money for consumers as oil and gas make up a large part of many people's budgets. Cheaper oil means that consumers will have more spending money, and that manufactured goods may be cheaper as well due to lower energy and transportation costs. While this may not be benefiting the oil producers, it is very beneficial to consumers, who benefit most from the low prices. According to the article, the low prices were supposed to last through at least 2015, and possibly through 2016 as well. The large amount of supply makes the prices for the oil cheap, which raises demand for the oil.
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Sydney Gabbard
5/11/2016 09:12:40 am
Lower oil and gas prices give people more money to spend. The authors state, "The recent drop in gas prices is set to provide the United States economy with a multibillion-dollar boost through the holiday season and beyond." The drop in oil and gasoline prices are due to big domestic energy production and Saudi discounts for crude oil. The drop of oil and gas prices are most beneficial to the middle and lower income Americans. These low prices are supposed to last at least a year. Edward Morse said "Even if growth turns around globally, it would take two years of added demand around the world to move prices per barrel back to the mid-90s.” This is an example of supply and demand because there is more production therefore prices are going down. "When oil prices fall, the benefit to consumers outweighs the loss to producers." The money made because of the drop off in gas and oil prices outweigh the loss of energy production jobs.
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Callie
5/11/2016 10:01:59 am
Lower oil and gas prices affect the amount of money people have greatly. People buy gas all the time so if it is less expensive, the amount of money in people’s pockets is increased. Lower oil and gas prices are most beneficial to low and middle- income Americans because those are the people that need the money for other things. Dean Maki states that “when oil prices fall, the benefit to consumers outweighs the loss to producers.” Ms. Yucel explains that “there may be some slowing, but it’s not going to be dramatic if we stay around $80,” and that “if the price goes below $70, we will probably see a tapering off of production.” This is an example of supply and demand because when the price of gas and oil increases, there is an increase in quantity supplied and the quantity demanded falls.
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