Economics Commentary Number: Practice
Title of Extract: Calorie Labeling Doesn’t Curb Fast Food Habits
Source of Extract: www.izzit.org
Date of Extract: Tue Oct 6, 2009
Word Count: 702
Sections Syllabus to which the commentary relates: Section 2.2
According to the mayor of New York, Michael Bloomberg, Americans has the right to eat what ever they want. It is because of this attitude that makes America one of the leading countries in adult obesity. A current study was conducted by New York University and Yale University to see if by increasing the print of nutrition facts and posting them on the menus at fast food venues would affect the amount of fast food consumed. These studied were done in low-income neighborhoods resulting in a low response to the change with nutrition facts.
The research carried out suggests that the fast food industry is a major component in many low-income American’s Income elasticity of demand. Income elasticity of demand measures the degree to which consumers respond to a change in their income by buying more or less of a particular good. In the case, the study focused on neighborhoods where income was decreasing. Even though the money people had was scarce, or having an inadequate supply of money, the people were interestingly enough buying more McDonalds than before. Many researchers teamed had up and came to a consensus that people rely more and more on inferior goods, or those good of lesser quality and generally less expensive, that normal or superior goods, which are goods that have a better quality and tend to have a higher price tag than the inferior goods. This reaction is due to the consumers’ spending limits where they can only spend a certain amount of money. The main component of spending limits is income. When a person’s income is high, that person has a large spending limit because there is flexibility and extra money to spend. To the...
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