• Shrinkflation: which reduces the amount of food while increasing the costs. This has made eating out more costly for consumers.

• Healthy Options: Due to the pandemic, people have become more aware of their health and started to demand healthier options. Fast food companies started to provide more options, which came with an upcharge

• Changing Dollar Menus: Many chains have started to remove the dollar menu due to the rising inflation, this meant that they had to make changes to make it seem as if their food is still affordable. For example, McDonald's has changed their $1 menu name to the $1 $2 $3 Menu.

This has made eating out more costly for consumers.

• Membership Card: The membership card fees contribute to the operating costs, allowing them to have such low prices for their goods.

• Food Court Prices: The food court offers a variety of food in larger sizes and lower prices compared to fast food chains. For example, the Costco Hot Dog has remained the same price of $1.50 since it was introduced in 1984.

• Generic Brand Options: Costco offers Kirkland Signature, their generic brand that is priced lower than the name brand alternatives.

These methods have contributed to their customer loyalty, making them a top retailer.

Fast food companies target locations where healthy food markets are not readily available to make it convenient in lower-income households, increasing their supply. Supermarkets tend to target areas where they can make a profit, so supply is lower in these neighborhoods.

Demand Curve for Fast Food vs Healthy Food:

There is a higher demand for fast food in lower-income neighborhoods due to its convenience, marketing, and prices, shifting the curve to the right. On the other hand, limited access to supermarkets and healthier options shifts the demand curve to the left.

Market Equilibrium:

In lower-income households, there is a higher demand and supply for fast food chains. This limited access to supermarkets results in deadweight loss due to the externalities of a lack of nutritional education, poor health decisions, and diet-related illnesses.

Cooking at Home:

Cooking at home is almost always going to be cheaper and healthier than fast food, however, it requires more time. So, the opportunity cost of cooking at home would be foregoing the next best alternative one could have done with the time used to cook.

Eating Fast Food/ Out:

Eating out is quicker than cooking a home cooked meal, however, it is often times more expensive and unhealthier. So, the opportunity cost of eating out would be foregoing the next best alternative one could have used that extra money on, as well as its health consequences.

Groceries:

Consumers who are on a stricter budget tend to be more elastic towards rising grocery costs. This is because they are more sensitive to the increases in price. This also ties into the substitution effect, since consumers may substitute one product for a cheaper alternative due to their budget.

Eating Out:

For individuals who are on a tight schedule and have a lack of time, their demand or eating out would be more inelastic, because they are not as sensitive to price increases. This is because individuals would rather pay the extra money for the convenience of fast food.

Those who always cook at home might make large batches every time they cook. This means they are eating the same thing over and over again in a short period of time to ensure the food doesn't go bad. After a certain time, every time the individual eats another meal of the large batch they made, their utils decrease. This may lead them to wanting take out since their marginal benefit from their meal prep no longer brings them enough utils.

Americans spend about $2,500 to $3,639 on fast food annually. Cooking at home is more economical since you can have more food at a lower cost. There is usually an upcharge when eating out. For example, the private grocery store steak can increase by 300% at a restaurant. Inflation at fast food locations has increased by 60% in the last decade, making it more expensive to eat out.

Health:

Meals cooked at home are almost always healthier than eating out at fast food restaurants. When cooking, you are aware of all the ingredients and have control over what you are putting on your plate. There are hidden ingredients such as preservatives and additives found in restaurant foods that can contain extra sodium, sugar, and fats that can affect your health. Relying on fast food can lead to health issues, especially in lower-income neighborhoods, where there isn't enough easy access to supermarkets.

You are more financially better off when you cook at home compared to eating out. The cost of the serving size is usually lower when you cook at home. Meal planning is a great way to save on cooking time and money. You become more financially free when you cook at home

Equality:

Individuals who live in lower-income areas should be provided the same amount of resources for healthy food options and nutritional education. It is a right to have access to healthy food. The government should fund grocery stores and supermarkets in these areas to promote healthy eating habits. There should be programs to educate people about the foods that they eat and how to cook healthy food at home.