Coffee Bean Market - Arabica by XueTing Lee https://padlet.com/lee_xueting/16S11GROUP1 en-us 2016-04-06 02:40:17 UTC 2025-10-21 05:30:08 UTC hello@padlet.com Chat Box lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270444 Ms Lee: Hi]]> 2016-04-04 06:39:46 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270444 Conclusion lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270445 However, the effect on equilibrium price may be indeterminate. Above , we have argued that the equilibrium price decrease because the demand for coffee beans in Brazil decreases more than its supply. However, if the decrease in supply exceeds the decrease in demand instead , the equilibrium price would increase instead.

it is also worth nothing that the effects of the above events on the equilibrium price and quantity would depend on price elasticity values. It is likely that the supply of coffee beans is price inelastic in the short run as agricultural products require a long time to grow and harvest. However, since there are many substitutes available for coffee beans such as sugar cane, the demand is price elastic which will cause consumers to switch to relatively cheaper substitutes which will cause the price of coffee bean in Brazil to decrease.]]> 2016-04-04 06:38:57 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270445 Body: State the new (final) equilibrium lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270446 The new equilibrium is at E2 where the surplus is completely eliminated.The new Equilibrium has a lower price of P2 and a lower quantity of Q2.]]> 2016-04-04 06:38:13 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270446 Body: Using the market adjustment process, explain how the shift(s) changes the equilibrium price and quantity (Explanation of diagram): lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270447 Note: Please draw the diagram manually, take a photo and upload it by clicking the "video icon". 

At the original equilibrium E1, price of coffee beans was P1 and quantity Q1.

At the original price level P1, the combined decrease in demand and supply of coffee beans leads to the new quantity supplied(Qs) exceeding the new quantity demanded(Qd).
Thus creating a surplus of QdQs units.
This exerts a downward pressure on prices of coffee beans.
As coffee beans prices decrease



]]> 2016-04-04 06:35:51 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270447 Body: Decide the direction and magnitude in which the curves shift lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270448 It is likely that the decrease in demand exceeds the decrease in supply of coffee beans.
Demand for coffee beans is likely to decrease significantly because of the recession which affects the whole of Brazil.The recession causes people to have lower income which leads to a fall in purchasing power so more people will switch to buying cheaper alternatives such as the robusta coffee bean or sugar cane instead of buying the arabica coffee beans which are produced in Brazil thus causing a decrease in demand.

On the other hand, the supply is only likely to decrease by a little "In response to the high prices of 2011 Brazilian farmers invested heavily in new acreage and improved yields with better husbandry and more fertiliser. "(article 1) so even if the crop this year has a decrease in supply by 30% due to leaf rust, the oversupply from previous years is able to cover up for some of the lack of supply this year.]]> 2016-04-04 06:34:27 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270448 Body: Identify and explain whether the factor/event shifts the demand or supply curve. (2 Demand + 1 Supply or 2 Supply + 1 Demand) lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270449 SUPPLY: 
S: From the news article 2, it states "That region has been hit by leaf rust, a fungal disease, which could destroy 30% of the crop this year." This shows that the production of Arabica coffee beans would decrease in the long run.
E: This is because the fungal disease would cause these coffee beans to be unsafe for consumption and thus not being able to be sold to coffee companies for coffee enthusiast to buy. Therefore, even though the Arabica beans have low prices, the supply itself decreases, causing a slight increase in prices of these beans. Hence, the disease would cause a decrease in supply of Arabica coffee beans. The supply curve would shift leftward, ceteris paribus.  



SUPPLY:
From article 1, it states thats "Coffee is a labour-intensive crop; picking is still largely done by hand." and "Wages in Brazil and Colombia are rising fast and production costs are above prices."  This shows that there is an increase in the cost of factor input. To produce coffee beans, various inputs such as fertilisers, seeds and labour of the workers are needed. As the coffee beans are harvested by hand, the price of the input of the labour of the workers will rise, hence producing coffee beans is less profitable and therefore lesser coffee beans will be supplied. Thus, there is an increase in the marginal cost of production, hence supply decreases, which is seen in a leftward shift of the supply curve, ceteris paribus. 



Demand:
As article 2 states “There are two main varieties of coffee bean: arabica and robusta. The former, which accounts for around 60% of the world's crop, is considered superior and fetches higher prices; the latter is a hardier crop, resistant to leaf rust.” Most of the beans produced in Brazil are of the arabica variety. Since there are different variety of coffee beans as substitutes therefore when there is a recession which people have lower income that reduces their purchasing power, consumers will thus switch from arabica coffee beans to purchase cheaper coffee beans which is the robusta variety hence causing the demand for robusta coffee bean to rise while the quantity demanded for arabica coffee bean to fall. This causes the price of Brazil coffee bean to fall and also causes a leftward shift in the demand curve for Brazil coffee bean, ceteris paribus.


]]> 2016-04-04 06:32:26 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270449 Body: State the initial equilibrium lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270450 At the initial equilibrium E1, equilibrium price is P1 and equilibrium quantity is Q1]]> 2016-04-04 06:31:44 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270450 Introduction lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270451 Explain market mechanism:
It is the process that works through the interaction of market forces of demand and supply to determine the equilibrium price and quantity of a certain good offered for sale in the free market

Define demand:
Demand is the amount of a good that consumers are able and willing to purchase in a given period of time at various prices

Define supply:
Supply is the amount of a good that producers are able and willing to offer for sale in a given period of time at various prices




]]> 2016-04-04 06:30:11 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270451 Welcome:) lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270452 Dear Students,

Welcome to Home-Based Learning 2016!

By now, you should have the list of the team members in your group. Each team will analyse 2 articles below to identify 3 evidence/information (2 Demand + 1 Supply or 2 Supply + 1 Demand factors)  to answer the following essay question:

a) With reference to the 2 news articles, explain the fall in prices of coffee beans in Brazil.

To discuss the answers with your group members, double click anywhere on the wall and a virtual "sticky note" will appear at the top. From, enter your name, then you can use the "sticky note" to "chat" with each other. 

For example, Miss Lee: I don't think that is a non-price factor that affects demand. Please remember to write your name before the statement :) 

Lastly, please identify these non-price determinants of demand & supply by quoting the relevant phrases from the article. 

For example, as stated in article 1, "the recession in Europe has hit demand". After quoting the evidence for the article please proceed to explain how this non-price factor affects demand or supply with economic rigour. 

I have provided some scaffolding statements to guide you in your essay development. Address each statement by writing the essay segment in the respective sticky note. Press the pencil button to write the respective essay segment.

]]> 2016-04-04 06:06:48 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270452 Topic: Demand, Supply & Market Equilibrium lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270453 Objective - Students will be able to identify and explain how the demand and supply factors affect the market for coffee beans.]]> 2016-04-04 06:04:45 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270453 Group name: lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270454 Please write out the names of the members in the group.
1. Henrich
2. Zi Hui
3. Xingyang
4. Serene
5. Umair]]> 2016-04-04 06:03:43 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270454 With reference to the 2 news articles,  explain the fall in prices of coffee beans in Brazil. lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270455 Availability of cheaper substitutes such as robusta beans and sugar cane
Increased cost of input - Coffee is a labour-intensive crop and labour prices are increasing]]> 2016-04-04 05:52:46 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270455 News Article 2 lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270456 2016-04-04 05:51:11 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270456 News Article 1 lee_xueting https://padlet.com/lee_xueting/16S11GROUP1/wish/104270457 2016-04-04 05:48:50 UTC https://padlet.com/lee_xueting/16S11GROUP1/wish/104270457