ECON 2020 Macroeconomics Article

Topics: Supply and demand, Change, Substitute good Pages: 2 (485 words) Published: April 17, 2014
Article Analysis
1)According the article, most of the main problems have to deal with the supply side of things with a couple of demand determinants. The biggest problem, and the reason for the article, is to bring to light the decline of the orange-juice market. Main factors in the decline, according to the article, are people are trading and investing less in the market, supply has been compromised in a number of ways (hurricanes, citrus greening, etc.), and also demand is decreasing. One of the biggest problems is the change in consumer tastes. People are choosing to buy other, similar products because they are healthier according to the article. The title of the article even reads “Orange-Juice Market Is Getting Squeezed by Changing Consumer Tastes”. The article has more detailed explanations of the problems, but these are the main overall problems the orange-juice market has been facing in the last ten years or so.

2)The article mentioned a number of determinants of supply, but from my understanding I could only find examples of two demand determinants, those both being the price of related goods and change in consumer tastes. While the other three determinants of demand; Number of Buyers, Income, and Consumer Expectations might play a role in the orange-juice market, there was little to no examples mentioned in this article. According to the article, the number of buyers has not changed, it has no mention of people’s incomes, or what consumers expect from the market. The article does however mention that “Americans are drinking less orange juice” and that the “reason for the slide was the revival of the low-carbohydrate Atkins diet”. This suggests that consumers are changing their tastes to better and healthier foods, which means leaving orange juice behind. Another thing hurting the orange juice demand, according to the article, is the “greater variety in the beverage aisle”. Customers are choosing energy drinks, Vitaminwaters, pomegranate juice,...
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