Monday, January 31, 2011

Supply & Demand in the Goat Market

The Kansas City Star reported that the price of chevon (goat meat) increased during 2010. Why? Supply and demand!

Here in the United States there has been an increase in the demand for chevon (primarily due to the demand from individuals of Middle Eastern heritage), but that the supply of chevon has not increased in equal proportions. Hence when the demand for a product - like chevon - increases a greater amount than the supply, prices rise. In fact, the price of goats were trading in 2010 higher than the price of cattle, which is exactly what the supply and demand model predicts.

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