Friday, January 9, 2015



Recently as everyone who drives knows, the gas prices have dropped crazily. We can thank the Middle East for increasing the Oil exports, which increases the amount of gas we have in America, at a lesser price. This increase in oil has in a sense hurt the NYSE and also the Japanese exchange Nikkei 225, for most investors of oil traded their stock, causing the Standard & Poor’s 500-stock index to fall 37.62 points. So although the decrease of gas prices is helping everyday average Americans, it’s also hurting the economy in a sense. There are always two sides to every story though, I would describe what has happened is a good thing, but someone might disagree with me. A lot of workers are getting laid off in North Dakota and Texas because they are no longer needed, if we can just get oil from the Middle East why would companies want to pay extra money to workers? This is in a sense a Cost Benefit Analysis, we could be using money to pay workers in the U.S. to be harvesting this oil, or we can just get it from the Middle East which is obviously cheaper since prices are going down. The Marginal Cost has gone down since the Scarcity of oil has gone down as well. We no longer have to pay $4.00 a gallon because we are getting oil for cheaper, in larger quantities, which is our, as customers of gas, our Marginal Benefit.


 

2 comments:

  1. Bailey C., good use of concepts learned in class. Remember I still want you to add something that is uniquely you. This has a lot of facts and information but not a lot of human flesh on is. But I encourage you, good start, you are on the right track, keep at it, thank you for being on time.

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  2. If we only buy gas from the Middle East at cheap prices and "save" our money for better purposes while not hiring high-wage US oil producers, the Middle East would soon raise its prices and everything would be back to normal- paying too much for something so essential. What is NYSE? Great terminology.

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