Disasters

Recently hurricane Michael destroyed numerous homes and business in the Florida area. My thoughts and prayers are with everyone who was affected by this event. It was extremely unfortunate but luckily people have come together in order to rebuild the state’s cities.

Whenever natural disasters happen prices seem to increase and then they go back down over time. This is explained by supply and demand. Resources are harder to get after natural disasters occur which makes it cost more to produce the good which means that suppliers have to charge a higher price. When price increases, demand decreases and supply increases. Suppliers supply more because they know they can make more money off of their product. Consumers, however, do not like to pay more so they will buy less creating a lower demand. This leads to a surplus and that makes price decrease, supply decrease, and demand increase. If the suppliers didn’t charge more for a good then there would be shortages. It stinks that people have to pay more when they are so desperate but it is all a part of the balance of the economy.