Questions for Classroom Discussion on Supply, Demand and Equilibrium

Keeping in mind the economics of Dybvik’s article, consider the fairness of the following:

  • While ethanol is considered a substitute for gasoline, not all consumers will choose to use ethanol.  However, all consumers will ultimately face higher prices for corn-based food products because “the trend has been to divert some corn production to ethanol.”   
  • Transportation companies are adding fuel charges to invoices, driving up the prices of goods sold by retailers who pay these fuel charges.
  • A justification for charging higher prices for food is that higher prices force consumers to eat healthier and buy locally.

Posted by Prof. C-S


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