Question

Suppose that the market price of vegetables recently increased substantially this year. Develop responses with detailed justification for each question below.

Questions:

1. Are there any changes in the supply or/and demand for vegetables this year?

2. Will this pattern persist next year?

3. Can 'receiving profits by charging a higher price' be justified from a biblical perspective

Answer 1

Answers:

1. Yes, the demand and supply both changes with the change in market price. When the market price rises, the demand will fall. Because consumers will try to consume the good less when its price rises. And the rise in market prices will lead to a rise in the supply of the good. Because producers will try to sell more at a hiked price to gain more revenue from it. But the fall in the demand will not be as much as the rise in the price.

2. If the supply of the vegetables increase more the next year, then the prices will fall. A large amount of supply in the market will lead to a fall in the price, since vegetable markets are perfectly competitive.

3. Receiving profits by charging a higher price is justified from a biblical perspective only if the profit making doesn't harm any poor. Profit shouldn't be made from the poor people according to the Bible.