MIEC Project - TI01 (DURIANS) by Jessy Lene https://padlet.com/jazzlyn35/2y4k07zbqpuz By: James Ko, Janice Chow Wei Lin, Jessy Lene Deserva Amolar, Lew Jun Shao, Miguel Bay Hong, & Sim Jie Ee en-us 2019-01-08 12:30:12 UTC 2024-06-10 07:42:44 UTC hello@padlet.com Article 1 - Durian prices plunge amid supply glut from Malaysia [6 July 2018] jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318253764 2019-01-08 12:33:08 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318253764 “Prices have dropped dramatically due to an oversupply caused by hot weather in Malaysia” jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318254330 2019-01-08 12:35:16 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318254330 “[A mao shan wang durian] is currently selling at $12 to $15 per kg, down from its usual price of between $28 and $35 per kg” jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318255182 2019-01-08 12:38:13 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318255182 Market Equilibrium (Surplus) jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318255338 This article talks about the factors surrounding the increase in supply in durians and how the surplus have affected the prices for durians. Through this article, we aim to apply the supply and market equilibrium concepts we have learnt.
  • The hot weather led to a higher quantity of durians supplied as the durians ripened faster. An oversupply means that there is a surplus of durians (quantity supplied exceeds quantity demanded).
  • When there is a surplus of durians, there is a downward pressure on price as sellers are forced to lower their prices.
    • Prices dropped to $12 to $15, compared to the usual price of between $28 and $35.
  • The sellers’ goal in mind is to get buyers to buy more, so that their surplus of durians is minimised and they do not have to throw away as many overripe durians.
]]> 2019-01-08 12:38:46 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318255338 Article 2 - Durian prices expected to dip further [15 Nov 2018] jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318265671 2019-01-08 13:06:40 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318265671 Article 3 - Durians on sale for RM1 each in Malaysia as glut continues [22 July 2018] simjieee https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318455119 2019-01-08 17:55:46 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318455119 "Slow customer traffic is a key factor in this price drop." jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318456569 "Ms Linda Ang, owner of Combat Durian, said the school holiday period is coming up "and people are going on holidays, so fewer people are buying"."
"A spokesman said that besides the school holidays, other year-end activities also affect the buying power of customers. For instance, they might be saving up instead for Christmas or new textbooks and uniforms for their children, he said."]]> 2019-01-08 17:57:49 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318456569 Change in Non-Price Determinants of Demand: Number of Buyers jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318466788
  • Some people have already planned to spend their money for other uses such as going on a holiday or buying new textbooks and uniforms to prepare for the upcoming year. 
  • Not expecting the sudden durian glut, they did not make it a point to set aside money to buy durians.
  • As such, there is a decrease in the demand for durians.
  • This change causes the demand curve to shift to the left.
  • The equilibrium point shifts from E1 to E2.
  • The quantity of durians demanded decreases and the price of the durians also decreases.
    • ]]>     2019-01-08 18:13:47 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318466788     Change in Non-Price Determinants of Demand: Expectations of Buyers jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318485122
  • Buyers expect prices of durians to drop.
  • As such, they hold off buying durians, causing a decrease in the number of buyers and therefore a decrease in demand.
  • The demand curve shifts to the left.
  • The equilibrium point shifts from E1 to E2.
  • The quantity of durians demanded decreases and the price of the durians also decreases.
    • ]]>     2019-01-08 18:39:47 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318485122     "People have a wait-and-see attitude. They are waiting for prices to drop further before they buy." jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318485764 2019-01-08 18:40:32 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318485764 Surplus - Graph jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318494686 2019-01-08 18:53:03 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318494686 Change in Non-Price Determinants of Demand - Graph jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318495455 The change in both non-price determinants of demand can represented by the same graph.]]> 2019-01-08 18:54:07 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318495455 "Durians are a luxury, and not a necessity." jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318498507 2019-01-08 18:58:32 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318498507 Determinants of Price Elasticity - Necessity VS. Luxury jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318498911
  • The demand for necessities are usually price inelastic while the demand for luxuries are usually price elastic.
  • From the previous quote, we can see that buyers wait from a drop in price before buying their durians.
  • When the prices did drop, one customer spent as much as $400 on durians.
  • This in itself shows that the buyers are very responsive to the change in the price of goods, and therefore, the demand for durians is price elastic.
  • A change in the price of durians will cause a bigger change in the quantity of durians demanded.
    • ]]>     2019-01-08 18:59:08 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318498911     "Durian lover Hendra Susanto, 45, a trader of natural resources, has already spent $400 on durians from Combat Durian in the past four days when prices ranged from $18 to $22 per kg, noting that the prices are "very good"." jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318503440 2019-01-08 19:05:52 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318503440 Price Elastic - Graph jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318506293 2019-01-08 19:09:37 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318506293 "Makeshift durian stalls began mushrooming in late February amid expectations the season was expected to end in May" junshao123 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318649517 (Ease of Entry: Easy)]]> 2019-01-09 06:20:19 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318649517 "In March, sellers slashed the price of the Musang King variety from RM125 per kg last year to between RM50 and RM65 per kg. The Black Thorn Grade A durians were sold at RM75 per kg, compared with RM100 last year. Some "vintage" varieties, however, saw only a minor drop in prices." junshao123 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318657930 (Similar products and close substitutes with a range of prices)]]> 2019-01-09 07:29:58 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318657930 Market Structure (Monopolistic Competition) junshao123 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318658777
  • Monopolistic competition is defined as a market where there are many sellers for a product selling products that are closely similar and are substitutes of each other.
  • In this market structure, there are many sellers and buyers, it is relatively easy to enter, and a good amount of information is available.
  • However, due to the ease of entry and availability of information,firms face a lot of competition and have limited power to set prices.
    • ]]>     2019-01-09 07:34:16 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318658777     Market Structure (Monopolistic Competition) jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318884976
  • We can see that the durian market is a monopolistic structure due to the variety of similar but differentiated products.
  • There are different price points for different types of durians, with the lowest quality durian of the Musang King variety costing only RM50 to RM65 per kg, all the way to The Black Thorn Grade A at RM75 and vintage varieties at around RM100 per kg.
  • This shows that there are differences in quality within the durian market, causing varying price points, a unique characteristic of the monopolistic structure.
    • ]]>     2019-01-09 17:00:02 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318884976     Market Structure (Monopolistic Competition) jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318888102
  • Apart from physical and product image differences, which show the monopolistic competition characteristics, we can also observe that the durian market is relatively easy to enter into.
  • There are very little barriers to entry. Makeshift stores can be easily established.
  • We can also observe from the article that sellers have limited individual power in setting prices as in the article we can see that sellers have collectively come to slash prices of durians, which was previously above RM100, to within RM100, which further proves that there is monopolistic competition within the durian market.
    • ]]>     2019-01-09 17:05:13 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318888102     jazzlyn35 https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318892403 The durian market is closely related to agriculture produce market, thus making almost making it a perfect competition. However, it is not in perfect competition, based on evidence from the three articles.

    The difference in prices and products set it apart from perfect competition. The ease of entry, relatively good amount of information available for sellers and buyers, limited power of individual sellers, and physical and product image differences shows that the durian market represents a good example of a monopolistic competition.]]>     2019-01-09 17:12:11 UTC https://padlet.com/jazzlyn35/2y4k07zbqpuz/wish/318892403