How Will It Effect On The Market Equilibrium Price And Quantity Traded For Bottled Water When A

What would happen globally if the demand for natural resources is greater than the supply?

Supply and demand, when these words appear together, tend to evoke and invoke a certain conceptual frame, which is the frame of “market economics”. Outside of market economics, these terms have entirely different connotations. That, itself, is rather telling.Ordinarily, we don’t make “demands” on one another — except in authoritarian societies. What we do instead is offer suggestions, or statements of personal preference, etc. We do not generally command that the world respond immediately to our wants or preferences — unless we’re Donald Trump, that is. But ordinary people don’t make demands. Unless they are corporate CEOs. Gods. Demons. A-holes.And just what do we mean by “supply,” anyway?!! Take oil for example. There is NOTHING in the market dynamic with oil which would — on market terms alone — limit the supply on account of “demand” in a temporal context other than, say, a few weeks or months, at the largest temporal dimension. We can be well into “peak oil” and have oil be cheap as heck on the basis of a fracking boom which should be expected to last maybe a very few years 2–4 or so. Nothing in the “pricing mechanism” is a mechanism here. Not even in the slightest! Gasoline prices in the USA right now are astonishingly low — at just over $2 a gallon ! This is because of the fracking boom + the banking scam. It’s a banking scam because the banks cannot possibly break even on this fracking boom. Period. There is no way for them to do it. They have invested money they don’t have in a gamble that cannot win, and they full well know it. That’s because banks are not designed for long term … anything. The government is expected to “bail them out” when they fail and they are considered too big to fail. End of story.So “supply and demand” are part of the (very merely) fictional world we’ve been living in, and which is about to completely fail. It won’t work as a fiction and it won’t work in any other sense when it fails to work.Please don’t think you can solve this problem with gold or silver, which are also very real and also very fictional. You cannot eat gold and silver is simply a shiny metal — until it tarnishes.In other words, market economics is a lot like a religion with a stupid god.

If Coke increased its price, what would happen to Pepsi?

Since Coke and Pepsi are two similar products and not the same, people give preference to one over the other. The reason for it might be a slightly sweetened soda of Coke to that of Pepsi or a stronger soda essence of Pepsi over Coke.Taking into this micro-economic aspect of preference, if Coke inflates its prices two things might happen.a) Even though Coke has increased its prices, there will be customers willing to shell out extra bucks for its USP, or customers simply switch to Pepsi seeing the inflated price of Coke. Both possibilities are pretty real.b) If Coke inflates its price, the obvious incentive for Pepsi would be to drive their own prices down as to draw in more customers toward it which will lead to a slight segregation of the soft drinks market, the elitist Coke and regular Pepsi.

What is the solution to the diamond vs. water paradox?

Demand of a good is determined not by its total utility but by its margnial utility. Even if the total utility of water is much more than that of diamond but its marginal utility is much lesser because of virtual incessant production of water i.e easy and much wider availability of water. Because of this the marginal utility of water declines at a faster rate when the units consumed are increased but if an individual is given more diamonds, the utility derived would surely be relatively less decreasing with increase of its units consumed because of Engel law involved. Buying diamond is a luxury while consuming water is a necessity.