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Microeconomics Final Project
Spring 2012
Rawan M. Aldosari
201102565
203
“Cold weather has destroyed most of chicken production this season”
“Cold weather has destroyed most of chicken production this season”
Introduction
The poultry industry is one of the important industries because it is one of the sources of
animal protein and eggs as well as it is a substitute for red meat and fish.
The local government encourage building factories and farms for breeding and care of
poultry, nutrition and enable them to produce for markets.
In poultry farms and factories, the good environmental conditions must be available, such
as adequate space for living, eating, drinking, ventilation, and temperature control to
avoid problems resulting from poor environmental conditions, but sometimes they do not
have these conditions then problems occur, such as disseses, heat stress or cold weather,
The cold weather condition is the event that I am going to talk about in this project.
Many markets has been affected when the cold weather destroyed most of the chicken
production this season, it has affected many markets of poultry such as chicken market,
egg productions, rice market, restaurants and feed markets”grain”. Each of these markets
represents something different, some are a substitutes, a complements or an inputs. Some
markets has affected the supply side and some affected the demand side.
#First Market
Name of the market: The Restaurants “chicken market”.
Event: Effect of chicken market on the restaurants.
Relationship: Chicken market is an input for the restaurants meals.
The demand will affect in a negative way.
Most of the restaurants are using chicken in the meals that served to their customers, but
when the cold weather destroyed a lot of chicken this season, significantly the restaurants
were affected in this event, because lots of restaurants offering main dishes containing
chicken, such as: Italian Pasta, Fried chicken or Burgers, they have had to raise the price
of meals to cover the costs of losses, so the demand decreased, because the supply
deacresed.
Conclusion: when the supply of chicken decreased the price will go up. So, the supply
curve will shift to the left. And the quantity demanded will decrease. This will make a
new equilibrium price and quantity.
#Second Market:
Name of the market: Fish Market.
Event: Effect of fish market on chicken market.
Relationship: Fish market is a substitute for chicken market.
The demand will be affected in a positive way.
The consumers is buying chicken from supermarket and because chicken market has been
effected because of the cold weather this season, supermarket will raise the chicken’s
prise and try to promot the other supstitute such as fish.
The consumers will stop buying chicken because of its high price and will buy the fish
instead, so the demand will increase, Supply will increase as well.
Conclusion: When the price of fish raises, the supply will increase. So the supply curve
will shift to the right. Vice versa, when the price of fish raises the quantity demanded will
increase and the demand curve will shift to the right.
#Third Market:
Name of the market: Rice market.
Event: Effect of chicken on rice.
Relationship: the rice is a complement for the chicken market.
The demand will affect in a negative way.
In Saudi Arabia the most favorite meal is chicken with rise “Chicken Kabsa” so the rice
is a complement of chicken.
Rice market are affected significantly when the chicken market affected, that means if the
price of chicken is going high and demand go less, that will decrease the price of rice and
will decrease the demand for it as well.
The demand will decrease, supply will decrease.
Conclusion: When the price of rice goes down, the quantity demand will decrease and
the demand curve will shift to the left. This will change the equilibrium point.
#Forth Market:
Name of the market: Meat market.
Event: Effect of meat market on chicken market.
Relationship: Meat market is a substitute for chicken market.
The demand will affect in a negative way.
When there is rising for the price of chicken in every where, it is very natural that
customers will try to find a substitute, and red meat are the most appropriate supstitute for
chicken. So if the price of chicken goes up, the supplier will supply more meat, that
means it will increase, and customers will buy more so the demand will increase as well.
Conclusion: When the prices of chicken become higher, the supply for meat will
increase. So, the supply curve will move to the right. Also, the quantity demand will
increase and the demand curve will move to the right.
#Fifth Market:
Name of the market: Feed market ”grain”.
Event: Effect of Chicken on feed market.
Relationship: The feed market is an input for the chicken.
The demand will affect in a negative way.
If the number of chicken in markets deacrease because of the cold weather, the farmers
will not buy grain so the demand of the feed market will deacrese, therefore, the price of
grain will goes down, the supply will decrease.
Conclusion: When the price goes down, the supply will deacrese. So, the supply curve
will shift to the left. Vice versa, the quantity demand will decrease and the demand curve
will shift to the left. This will make a new equilibrium price and quantity.
Summery:
In my case, there are changes in factors other than the price of chicken, which is the cold
weather that affected the quantity supplied. This change has affected a lot of other
markets as mentioned in this case which are chicken market, fish market, rice market,
meet market and feed market “grain”.
The findings, that we cannot control the economy; it could rise based on some factors and
fall based on other factors, for example what was written on the top of this paper.