Download After Mid

Price differentials of
moon cakes
before and after
Mid-Autumn Festival
in Hong Kong
Group members:
Jasmine Chan
(2)
Kennes Hung
(5)
Elain Tsang
(25)
Renee Angeline Yeh
(32)
Dorothy Yung
(34)
Moon cakes
• Moon cakes are Chinese pastries traditionally
eaten during the Mid-Autumn Festival
• The festival is for lunar worship and moon
watching; moon cakes are regarded as an
indispensable delicacy on this occasion
• Moon cakes are offered between friends or on
family gatherings while celebrating the
festival, one of the three most important
Chinese festivals
Price Differentials
September 20 or before
$175
September 27 or before
$200
% increase: 12.5 %
During Mid-Autumn:
Moon cake is an inelastic good
(Everyone needs it to celebrate the
festival and it is expensive)
After Mid-Autumn:
Moon cake is an elastic good (The
festival is over and the price is
relatively low)
Demand and Supply curves
During Mid-Autumn
Mooncake
P
D1
D2
S1
S2
-----------------------------------------
---------------------------------
P1
Q1
----------------------------------------
P2 -------------------------------------------------------
Q2
Q/T
Demand and Supply
During Mid-Autumn
• When Mid-autumn festival approaches,
people’s demand for moon cakes increases.
The demand curve moves from D1 to D2
• As so many people want to buy moon cakes,
more moon cakes are produced. The supply
curve moves from S1 to S2
• The price increases from P1 to P2
• The quantity increases from Q1 to Q2
• The total revenue therefore increases
Demand and Supply curves
After Mid-Autumn
Mooncake
P
D2
D1
S
P2
----------------------------------------
Q2
------------------------------------
---------------------------------------------------
------------------------
P1
Q1
Q/T
Demand and Supply
After Mid-Autumn
• After people’s demand for moon cakes
decreases. The demand curve moves from D1 to
D2
• As people don’t want to buy moon cakes
anymore, the supply doesn’t increase
• Price decreases from P1 to P2
• The quantity decreases from Q1 to Q2
• The total revenue therefore decreases
Different Ownerships
Private Ownership
(Private Limited Company)
Wing Wah
Features:
•The company raises capital
from existing shareholders
•Need not to disclose financial
statements to the public
•Shares can be transferred with
the consent of other shareholders
•The shareholders are usually
directly involved in running the
business
Private Ownership
(Public Limited Company)
Maxim
Features:
•The company raises capital by
issuing shares and bonds
•Need to disclose financial
statements to the public
•Shares can be quoted and traded
in the stock exchange market
•The shareholders are responsible
for bearing risk
SURVEY RESULT
• We gave out 30 questionnaires
• 30 people said that they would buy moon
cake before mid autumn festival
• Only 4 people said that they would also
buy moon cake after mid autumn
festival
SURVEY RESULT
• 26 People said that moon cake was only for
festival celebration while the other 4 said that
it wasn’t
• Only 24 people said that they love eating
moon cake
• 14 people loves eating the traditional moon
cake. 12 people loves eating ice-skinny moon
cake. Only 4 people loves eating ice-cream
moon cake
SURVEY RESULT
• 26 people said that they will still purchases
the moon cake if it is expensive
• 18 people said that the flavors will change
their mind in choosing the other brands of
moon cake . 10 people said that the prices will
change their mind. While 2 people said that
the brand will change their mind
SURVEY ANALYSIS
• Moon cake is a festival good
• The degree of necessity of moon cake is very
high
• Therefore it is an inelastic good Almost
everyone needs to celebrate the festival with
this traditional good due to their traditional
habit
SURVEY ANALYSIS
• Whatever the price rise, people will still buy it
• Different kinds of moon cakes have different
price which depends on human desire
• For some ice skinny moon cake and ice
cream moon cake: they will will be more
expensive
• However, people are not really concerned
much about the prices, but they care about the
flavors of the moon cake
Conclusion
• Moon cakes become higher in price during
and before Mid-Autumn, but then become
cheap again when demand becomes lower
• Thus, they follow perfectly the law of
demand
Our Feelings
• This situation is just the normal feature in a
capitalist society
• Businesses, such as moon cake makers, aim
to make the most profit
• So, if they change their prices according to
demand, they can maximize their gain
References
• www.yahoo.com.hk
• www.kee-wah.com.hk/public/MoonCake.html
• www.maxims.com.hk/mooncake/chi/index.h
tml
• www.moon-cake.net
• Magazine
THE END