Essay about Eco 365 Week 1

692 WordsAug 16, 20133 Pages
Article analysis: Pump Prices and Oil Prices: A Tale of Two Different Directions By Ernest Guillen University of Phoenix ECO/365 Ver.4 Principles of Microeconomics Instructor: Dr. Christina Espinoza-Alguera Abstract: The following article is regarding what is most important to everyone around us regarding the pricing for gasoline at the pumps. This is a topic that concerns most people on this planet, why are the prices for gasoline so high and is it regarding the greed of oil producing companies to continue to keep rising the gasoline prices as high as possible. We will discuss the many reasons why these fluctuating pricing keeps occurring within our world market. We will use the retail gasoline pricing between the…show more content…
(Rising Gas Prices) Supply and Demand: The supply and demand are the main driving forces within this market, it can cause a change instantaneously overnight, and these cost issues are immediate to the consumer. There could be a fire in one of the local refineries causing product shut down, this can create a panic at the pump as well. There are many reasons why this product is so volatile, it cost too much money to refine and thereby is restricted in the method of refining. Supply means that there is a large supply available for product usage, pricing goes down, too much product, if the Demand is exact opposite occurs and there is short supply and the pricing is extremely quick to be changed at the pump. The markets can be also affected; they can be changed no matter how far the original production occurs, economics are disturbed, countries global markets respond to higher cost factors to operate business development causing inflation to jump to higher records slowing down global progress. My Opinion: I strongly believe that this is an elastic product, it can change pricing to extreme highs

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