Numbers That Sway Markets and Voters, Article Review Example

Source: http://www.nytimes.com/2012/03/04/your-money/rising-gasoline-prices-could-soon-have-economic-effects.html?ref=business

 Summary

Gasoline prices seem to have a great impact on the growth and development of several nations around the globe. As for a fact, there are some countries that become highly dependent on the matter hence causing them to panic when instant increase of prices come into realization. Relatively, the production of oil and how it is being controlled by the oil industry operators create a great impact on how international development faces this dilemma. The same thing goes when it comes to creating a reputation for certain government administrations on the mind of the consumers. With the intense development of industrialization procedures in urbanized countries, it is expected that the international market would have issues concerning its capability to provide for what the public really needs from its sector of operation.

Economic Analysis

 The law of supply and demand specifically applies perfectly to this case. Understandably, the higher the supply, the lower the price, however as the demand increases and supply decreases, the prices hike up which usually causes economic commotion. Another theory in economics that could be applied in this article is the Keynesian theory which depends on the income-expenditure balance among operators of several industries in the market. As for the need to compensate for the higher prices of oil products which affects the prices of other commodities, several companies intend to adjust their systems of operations in an aim to lower the cost of expenditure hence retaining a good profit percentage.

 Personal Reflection

This article has been particularly chosen for analysis due to the fact that oil-price-hike issues directly affect the modern society and how it progresses towards development. The consideration over such matter gives a great indication on how operators of the modern industries are able to manage their operations and expenses so as to compensate for what is being lost to oil-price hike in the market. Understandably, the international market is in need of seeing to it that such control to fuel prices is given practical attention to especially when it comes to balancing out the process by which supply and demand meet in the middle of the course of values exchange in the market.