@}->-- --<-{@
The JC Economist's Favourite Things
(Sung to the tune of My Favourite Things
from the musical The Sound of Music)
(Sung to the tune of My Favourite Things
from the musical The Sound of Music)
Valentine’s Day falls on February 14th
Prices of roses go up before 14th
I wonder why prices go up so much?
Oh tell me, oh tell me, oh tell me why ….
Demand shifts right
Excess demand
Prices are pushed up
That’s why my roses cost so ve--ry much
I have to save up
To buy!
Prices of roses go up before 14th
I wonder why prices go up so much?
Oh tell me, oh tell me, oh tell me why ….
Demand shifts right
Excess demand
Prices are pushed up
That’s why my roses cost so ve--ry much
I have to save up
To buy!
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When do the prices of flowers start to go up? (Excerpt from ST, 8 Feb 2007)
Prices of roses usually start going up a week before Valentine’s Day. On the day itself, they can be double the usual price. Other popular flowers like tulips and lilies also see their prices jump by about 20 per cent.
Food for thought
1. Before Valentine's Day, why does demand for roses 'shift right'? Does supply of roses also shift? Why or why not?
18 comments:
Demand for roses 'shift right' before Valentine's Day because that is the time when guys rush to buy roses for their significant others. Roses are appropriate because they symbolize love. As such, many aim to buy one or more roses for their special ones on Valentine's Day. The supply of roses does not shift because the production cost and other supply factors remain the same, Valentine's Day or not.
LINK: http://www.santamariaflowers.com/consumer/valentine_prices.html
(a website explaining the price increase of roses just before Valentine's Day)
The demand of roses shifts right means its demand increases is because Valenine's Day is a day to express their love to the other half, while roses represent love and hence, more people will buy it before the day comes. However, the supply of roses does not rise, because the producers do not expect the production cost of roses to change and their profit will not change either.
Web link:http://www.msnbc.msn.com/id/17858379/
this is a news report on demand in jobs. Demand may not necessarily only on goods, but also services.
The demand of roses shifts right means its demand increases is because Valenine's Day is a day to express their love to the other half, while roses represent love and hence, more people will buy it before the day comes. However, the supply of roses does not rise, because the producers do not expect the production cost of roses to change. [Edit: But profit may go up. Profit = Total Revenue - Total Cost. If Total Revenue goes up and Total Cost remains constant, then Profit goes up.]
Web link:http://www.msnbc.msn.com/id/17858379/
this is a news report on demand in jobs. Demand may exist not necessarily for goods, but for services as well.
The demand curve for roses shift right since there will be an increase in demand of roses during Valentine's Day. Roses symbolise love thus many people will tend to buy roses on this special day for their loved one. Demand for roses will therefore increase. However the supply of roses remain the same. This is because the producers are unable to produce so much roses in such a short time. The production cost and supply factors also remain the same thus there is no increase in suppy of roses.
The demand curve of the roses shift right just before 14th feb, valentine's day an occasion of which roses should never be lacking in order to show how much one treasure his/her loved ones. However, the factors of production of the roses remains the same therefore the supply curve do not shift right as well. Producers recognize this fact that their supply of roses are high in demand,thus they take the oppurtunity to jack up the prices of the rose in order to acheive maximum profit.
(The website has an article which shows the increament in prices of roses just b4 valentine's day and states a few reason for that)
Demand for roses will increase because of a special occasion - Valentines Day. Roses are common gifts to their other halfs, signifying love. Demand curve shifts right and thus there will be a new equilibrium with an increase in price.
However, supply will remain the same as the there is no change in the FOPs and production cost. Everything remains ceterus paribus.
'Demand shifts right'and 'excess demand'show that the demand for roses increases before valentine's day such that consumers are able to express their love and fondness towards their specific partners with the roses during the day itself. The presumption of the price of roses doubling during valentine's day as it occurs almost annually will also urge the consumers to purchase the roses before valentine's day when the price is lower.
Supply of roses may be temporarily reduced before valentine's day due to the producer's expectations of the price increase of roses during valentine's day(this price increase happens during every valentine's day).Therefore, producers may choose to sell most of their roses during valentine's day when the price rise.
Hence, with the demand curve shifting rightwards and the supply curve shifting leftwards, the equilibrium price of roses before valentine's day will increase.
link:http://www.umsl.edu/~econed/nelesson2.pdf
This link is a teaching material showing students how to apply various economic concepts we learnt in lessons to the prices of roses during valentine's day.
When Valentine's Day arrives, the demand for roses increases alot,hence the demand curve shifts right.Even though more roses are produced for Valentine's Day than at any other time of the year, the increase in supply is not as great as the increase in demand, hence the higher price for roses.
Because consumers are willing to pay the higher prices, producers are willing to incur higher costs associated with meeting the demand. In the end, the market for flowers at Valentine's Day is fully coordinated, with neither systematic shortages or surpluses.
source:http://www.mises.org/(S(nphehn453i5dvj453dfceqbo))/story/150
**this article is by Rob Blackstock
-Wendy Yang(19/07)
The demand for roses increases by a huge amount, hence demand curve shifts right.Even though more roses are produced for Valentine's Day than at any other time of the year, the increase in supply is by no means as great as the increase in demand, hence the higher price for roses.the supply curve shifts right but it will not shift as much as the demand curve. the consumers are willing to pay the higher prices, so producers are willing to incur higher costs associated with meeting the demand. In the end, the market for flowers at Valentine's Day is fully coordinated, with neither systematic shortages or surpluses.
source:http://www.mises.org/(S(nphehn453i5dvj453dfceqbo))/story/150
**this article is written by Rob Blackstock
-Wendy Yang(19/07)
The demand for roses on vday *shortform for Valentine's Day* shifts right because at that time of the year, the demand for roses increase. This is because vday is a special event of the year in which boys will try to get stuffs, usually flowers, to express their love to their love ones.
Link: http://www.fieldofflowers.com/flowermeanings.htm
That website will tell you the meaning of flowers, including roses of course. But different colour of roses give different meanings as well.
However, the supply of roses does not shift because firstly, planting a rose bush represent a long term investment. If the supply of roses increases, producers will face a problem when vday is over as there will be excess roses after that. The priduction cost and supply factors remain fixed. Thus the supply does not change.
By planting a fixed amount of roses, the producers does not have to worry of having excess roses after vday. Thus on vday itself, they are able to increase the prices of roses, and decrease the prices of it after. Since roses are not bought so often after vday, sellers are able to drop the price of it.
Link: http://www.fieldofflowers.com/rose_pricing.htm
*explaining why price of roses increase before vday*
Demand curve shifts right because there is an increase in demand for the roses during valentine. Rose is a symbol of love. Thus, many would buy roses for their loved ones on this special occasion. However, supply curve of roses will not shift since there is no mention of any determinant of supply, such as producer's expectation of future prices. Supply of roses cannot be deduced and so it should be the same.
It is a widely known fact that one of the most profitable holidays for florists is Valentine's Day. It is one of the rare occasions where wives, sweethearts or girlfriends can expect to receive a floral tribute. Due to thisincrease in consumer taste and preference, demand for roses increases, the price of roses increases, and therfore the quantity exchanged increases. Although one might question : What about supply? don't the suppliers know guys will be fighting for roses during peak season, and so will they not increase their supply? After thinking, my answer is no. If u draw the dd and ss curve, one will see that if supply also increases when the demand increases then the price at which the roses are sold will decrease - and sellers do not want that happening as they want more profits! so in conclusion, supply does not increase.
an excerpt from the website below:
Why the big price increases for Valentine's Day?
Supply and demand. Growers and wholesalers increase prices, and many florists nearly double their staffs to accommodate deliveries for Feb. 14.
Part of the problem is procrastination by consumers who wait until Feb. 13 or 14 to order, causing a rush.
http://www.iconocast.com/News_Files/ZZZNewsX5_XX/News9A.htm
During Valentine's, the demand of roses will increase as guys will send girls roses to express their love. Hence, the demand curve will shift right. Having expected this situation, the 'suppliers' will decrease its supply a week before Valentine's to 'increase' the demand and resume supply on the day. This will result in a leftward shift in the supply curve and an increase of the price of the roses. Due to the significant increase in price of roses, other popular flowers such as tulips and lilies,being relatively cheap,will be seen as an substitute for roses. Therefore, demand for them also increase,resulting in rightward shift in the demand curve and increase in their prices too.
Demand curve for roses shifts right due to the increase in demand for roses before Valentine's Day.
Sending flowers is a way to express our love to our loved ones, especially during Valentine's Day.
Since all roses express love and appreciation, the demand for roses will thus increase before Valentine's Day.
The supply of roses,however,will not shift.
This is due to if the producers were to meet the increased demand of roses before Valentine's Day(in February),they will have a lot more roses than they can sell in other months(such as July).
Thus, in order to avoid such a situation, the producers will not supply more roses and the supply curve for roses will not shift.
http://www.fieldofflowers.com/rose_pricing.htm
-> a website explaining why does the price of roses sometimes change, especially for valentine's day.
Before Valentine's Day, demand for roses 'shifts right' due to an increase in demand for roses during that period of time.
Roses are the traditional gifts for valentine's as they symbolise love and romance. Thus, before valentine's, people will rush to get their roses for their loved ones.
Supply of roses does not shift. Production cost of the roses, and other factors of supply remain unchanged, whether on valentine's or other days. Thus, supply is fixed.
LINK:
http://slate.msn.com/id/2078337/
( it states reasons for rise in prices of roses)
http://www.organicbouquet.com/images/pages/static/pressroom/20040201-MSNBC.pdf
Pearlyn Wong From 19/07 (:
Demand curve shifts right means that there is a change in quantity demanded which is brought about by the change in consumers' preferences and choices. During vday, many men would use roses to show their love for the ladies and sending roses on vday has a impactful significance. as a result, cauing many man wanting to buy roses on vday. this cause the quantity demanded for roses to rise greater. thus, the curve shifts to the right by a big magnitude. however, supply increase sightly. the producers have future expectation of roses prices will rise greatly due to vday thus will try to produce more roses to maximise their profit, however, they are unable to produce so much rose to meet the demand within such a short time. As a result, the supply shifts to the right by a much smaller magnitude than the demand curve, thus, causing the market equlibrium price to rise.
When the demand curve shifts to the right, it represents that the demand for roses increase due to non-price determinant. As roses symbolizes love, thus during the Valentine's Day week, couples would rush to get them for their loved ones. But however on the other hand, the supply of roses remain the same as the production cost of producing roses remains unchanged.
(actually i feel that more information like technological changes, is needed to decide on whether the supply curve did shift.)
Web Link: http://www.umsl.edu/~econed/lesson2.htm
The prices for flowers,especislly roses,usually go up when Valentine's Day is approaching.This can be explained through demand and supply analysis.On V day,there is an increase in the number of people giving flowers to their partners,hence there is an increase in demand for flowers at every price level,exeeding supply,resulting in a shortage,so there is an upward pressure on price,which explains the high price for flowers whenever V day approaches.As years pass,though suppliers know that there will bound to be increased demand for flowers during the V day period and had increased their supply,the high price for flowers still remains due to the suppliers' understanding of their consumers.They realised that consumers are willing to pay more for the flowers during V day so as to please their partners,thus they do not have the intention to lower down prices.Sometimes it may also be due to shortage of flowers despite the increase in supply because of the great extent in the increse of flowers,especially roses demanded.Example when men buy the flowers in large quantity due to the significance it holds,(99)which means forever.Therefore,high price for flowers is now a norm during V day.
Webpage-http://pool.judysbook.com/valentinesday/valentinesdayroses
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