...Trends in Gasoline ECO/365 Kimberly Lane February 21, 2013 In the world, people are dependent upon an important contributor to vehicles and vessels that allows travel to take place. Without gasoline, people cannot to travel throughout the countries to their destination. The world relies on gasoline to fly airplanes, operate trains, buses, and operate every type of vehicle or vessel. Gasoline is a major factor in the world considering transportation; however, people are discovering alternative methods to operate vehicles like using electricity or vegetable oil. Americans travel long distances to reach their destinations throughout the United States. Families like to take trips across country to experience the scenic routes of the freeway and discover places like the Grand Canyon, Route 66, and St. Louis Arch. Although people boycotting gasoline will not decrease the increasing price in gasoline, the demand for world oil is a cause in higher gasoline prices. Society would not be able to use transportation in vehicles if gasoline became extinct. People would have to resort to the old fashion method of transportation like riding a bicycle, walking, or creating an alternative method to mobilize their vehicles. Boycotting the increasing prices of gasoline through refusing to purchase will not lower the prices at the gas stations; however, the government has set in place a barter system to through export tangible goods with other countries for gasoline and oil. The prices of gasoline...
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...Week 1 Eco 365 Article Analysis The name of the article on this paper is OP-ED: Falling Gasoline Use Means U.S. Can Just Say No to New Pipelines and Food-to-Fuel. Through this paper, we have to analyze the basis for the trends in consumption patterns. Consider the utility derived from a product or service mentioned in the article. Describe what has occurred to change the demand for the product or service and its market and equilibrium prices. Describe what has occurred to change the supply of the product or service and its market and equilibrium prices. In your opinion, is demand for this product or service price elastic or inelastic? What does this imply about how consumers respond to changes in the price of this product or service? According to an article from the Inter Press Service, gasoline consumption trends have been declining (Larson, 2013). The declined gasoline consumption has an effect on the utility that is derived from the product. There are different reasons for the decrease that include individuals using different means of transportation, use of other fuels, and decreased sales. Although the price of gasoline has risen, and is still rising, the product is still to considerably inelastic. The inelastic price on gasoline affect the economy in all ways. The decline in gasoline consumption has an effect on the utility of the product including the decline of usefulness of the product among consumers, but still needing the product for exports in the United States...
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...Pricing Dilemma: Why is diesel more expensive than gasoline? Problem Definition In this research we will be looking to find out why is diesel fuel more expensive than gasoline despite historically being cheaper to produce. This paradox did not exist prior to 2004 but after that year diesel retail prices became consistently higher than those of gasoline,. As we look at different aspects of this situation we will uncover that there are several main reasons for that: 1. Transition to cleaner diesel fuels made the production more expensive. 2. Global demand for diesel fuel is very high and the refining capacity is tight. 3. There is a difference in terms of on-highway fuel tax between diesel and gasoline. 4. Variability in terms of raw material prices. Another important part of this paper will be the analysis of the competitive landscape in this industry. We will discuss how the competition might be affecting the prices of both types of fuels. The role of costs (supply) Upstream Petroleum industry can be divided in two major segments: upstream and downstream. The value chain for petroleum products consists of the following stages: 1. Prospecting and Extraction 2. Downstream Refining or Importing of Road Fuel 3. Wholesale Transportation and Bulk sales of refined products 4. Retailing The main determinants for prices are cost of crude oil, refining, taxation and profit margin. While different sources report different percentage contributions...
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...Article analysis We all know that the price of gasoline is continually moving in an upward direction. But what we really want to know is why this is happening, and what measures are necessary to cease this trend. In this selection, the writer will first consider the utility derived from gasoline. Secondly, we will be given a description of occurrences that changed the demand of gasoline and its market and equilibrium prices, assuming the supply remains the same. Thirdly, the author will describe what has occurred to change the supply of gasoline and its market and equilibrium prices, assuming that demand remains the same. Lastly, the writer will give his opinion on whether he feels gasoline is elastic or inelastic, and what this implies about how consumers respond to changes in the price of gasoline. Satisfaction of wants and needs obtained by the consumption of goods, is the main focus of utility analysis. The decision to purchase and consume a good is affected by the utility generated from consumption. Utility assumes a very precise meaning, which differs from the everyday use of the term, when used in the analysis of consumer behavior. The term utility means “useful”, in common use. For example, something that would be useful around the house: a “utility” knife. In Sports, one that can perform well in several positions would be considered a “utility” player. By all levels of government in the United States, a variety of taxes and fees are assessed on motor fuels. While...
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...Article Analysis According to an article from the Inter Press Service, gasoline consumption trends have been declining (Larson, 2013). The declined gasoline consumption has an effect on the utility that is derived from the product. There are different reasons for the decrease that include individuals using different means of transportation, use of other fuels, and decreased sales. Although the price of gasoline has risen, and is still rising, the product is still to considerably inelastic. The decline in gasoline consumption has an effect on the utility of the product including the decline of usefulness of the product among consumers, but still needing the product for exports in the United States. Although the product is not as useful for consumers, it is still a need amongst transportation. Many individuals need the gasoline as a way of transportation to work, school, doctor’s appointments etc. Aside from consumers, the product is a need for exports in the United States economy. There have been occurrences that have changed the demand of gasoline among consumers although the supply remained the same. Occurrences that have changed the demand of the product include the decline in car fleet, less driving among individuals, more fuel-efficient cars, the decline in registered vehicles, decline in new car sales, and the number of Americans living in urban areas (Larson, 2013). With less car fleets, there is less fuel to purchase for company transportation, and with more cars...
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...to remain the same. The economic expression to determine whether a product is elastic or in-elastic is ⋮%ΔD%ΔP⋮. That is, the Price Elasticity of Demand is the absolute value of the percentage change in consumer demand divided by the percentage change in consumer pricing. A good is said to be elastic if the price elasticity of demand is greater than one. Elasticity is a rather simple and straight forward concept when looking at a product in a specific time period. Gasoline is a product is a said to be in-elastic due to consumer demand and dependence on it. That is, if you were to look at a price/demand graph of gasoline during a 6 month period of time, it would resemble a linear graph with a negative slope. However, figure 1 tells a different point of view of the demand of gasoline with respect to price over a larger time period. Fg. 1 The trend line above depicts a positive slope which in this graph...
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...Introduction In this paper is analyzing the business idea of cousin Edgar to invest in four gas stations in U.S. After conducting researches and analyzing information, there are factors that Cousin Edgar might need to consider before the investment and start up the business. Firstly, the country’s economy health needs to be examined, whether the microeconomic factors, such as the level of demand in gasoline, monthly and a year and the factors that influencing supply of gasoline. Subsequently, macroeconomic factors determine the business idea in producing high profit, and also determining the business span in the short run or even in the long run. Macroeconomic analyzes in oil price According to The World Bank (2014) the total macroeconomic impact of the U.S. oil and natural gas industry is significant. Moreover, the industry was directly and indirectly responsible for over $1 trillion of value- added, or 7.7% of Gross Domestic Product (GDP). Essentially the estimation that the oil and natural gas industry’s total impact on labor income in 2009 was $534 billion (including benefits), which flow to 9.2 million Americans in jobs directly or indirectly in the industry or in jobs supported by those in the industry. In 2007, it is estimated that the industry directly and indirectly contributed approximately $280 billion of revenue to federal, state and local governments. The industry’s impact goes beyond the operations of the companies actively engaged in exploration and...
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...believes that the Filipinos can fight poverty by engaging in entrepreneurship as its competitive edge for growth and success. Long Term Goals Filoil is dedicated to uplift the Filipino entrepreneurial spirit as the catalyst for sustainable success and profitable business operation. Objectives * To profit * Sell about 2500-4000 liters a day * Build customer loyalty through good service and clean products * Increase sales by 10% annually * To offer the lowest possible price in the gasoline market Organizational Chart C. Product Category Review General description * Premium Gasoline “Flash Gas”- 93 Octane reading with engine cleaning additives * Unleaded Gasoline “Speedy Max”- 93 Octane Rating Lead-Free * Regular Gasoline- 83 Octane Rating * Biodiesel Fuel * Lubricants Sale Trends Gasoline is a necessity and it should be available at anytime of the day. Gasoline is one of the factors why the society goes on and the market prices rises. Gasoline makes everything faster than the way it is. People usually gas up before a price hike for them to save cash. Distribution Profile Filoil caters to both private and public cars. Filoil- Gonazaga caters to mostly the establishments near the location, from class A, B, and C. Pricing Overview In the petroleum industry, pricing...
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...Everyone’s gasoline problem The price of gasoline has varied widely from a current low of $3.98 a gallon to a high of $4.21 approximately ten weeks ago. In order to appreciate the reason for this fluctuation it is important to understand that the price of gas, like other commodities, is determined by the relationship of supply and demand. Since gasoline is a relatively inelastic product, the price alone does not have much bearing on the demand. Rather, other non-price determinants such as personal income and product availability play a bigger role in the demand for gas. The recent drop in prices has been largely attributed to a weakening of global demand; particularly the slowdown in Europe’s manufacturing industry. The unemployment rate in seventeen countries that use the euro has increased over the past few months and the United States has added fewer than expected jobs to the economy. These factors have led to a reduction in personal income thereby reducing the overall demand for gasoline. On the supply side of the equation, price increases earlier in the year were caused by supply interruptions in South Sudan, Syria, Yemen and the North Sea. This reduction in supply coupled with the tightening of sanctions in Iran reduced the number of petroleum sellers in the market causing a price hike at the pump. Consumer expectations of further supply interruptions led to the sustained higher prices. Being an inelastic product (few substitutes available), the actual retail...
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...The gasoline consumption patterns have been changing during the last several years. The consumption of gasoline in the United States declined 6 percent from 2007 through 2011 (Mufson, 2012). The shift has occurred because of more fuel-efficient cars, hybrid vehicles, and the increase in the use of bio-fuels. An increase in carpooling and people using mass transit contributes to a reduction in miles driven on an annual basis. People are also more conscious of the environment and global warming, which has caused them to choose fuel-efficient vehicles that have less of an environmental impact. The Obama administration has imposed higher fuel efficiency standards that will decrease consumption even further in the future. The changing consumption pattern studies falls under microeconomics. Microeconomics is a social science that deals with the scarcity of resources by examining how supply and demand affects who gets what and at what price. In a free market economy, such as ours, the forces of supply and demand are expected to act freely, such as the equilibrium price is determined by the intersection of the supply and demand curve. Various participants in the markets do interfere with free markets abilities to operate without interference, such as the government and other various parties, which causes prices to become distorted. It is microeconomics that studies the reasons for these distortions and other effects. The changing consumption patterns of consumers of gasoline, affects...
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...Filoil believes that the Filipinos can fight poverty by engaging in entrepreneurship as its competitive edge for growth and success. Long Term Goals Filoil is dedicated to uplift the Filipino entrepreneurial spirit as the catalyst for sustainable success and profitable business operation. Objectives * To profit * Sell about 2500-4000 liters a day * Build customer loyalty through good service and clean products * Increase sales by 10% annually * To offer the lowest possible price in the gasoline market Organizational Chart C. Product Category Review General description * Premium Gasoline “Flash Gas”- 93 Octane reading with engine cleaning additives * Unleaded Gasoline “Speedy Max”- 93 Octane Rating Lead-Free * Regular Gasoline- 83 Octane Rating * Biodiesel Fuel * Lubricants Sale Trends Gasoline is a necessity and it should be available at anytime of the day. Gasoline is one of the factors why the society goes on and the market prices rises. Gasoline makes everything faster than the way it is. People usually gas up before a price hike for them to save cash. Distribution Profile Filoil caters to both private and public cars. Filoil- Gonazaga caters to mostly the establishments near the location, from class A, B, and C. Pricing Overview In the petroleum industry, pricing depends on the economy. Filoil tries...
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...Petrol engine general gasoline spray into the air inlet pipe with air mixed be combustible mixture into the cylinder, spark plug combusts expansion work. People usually call it spark ignition engines. And is generally through the fuel injection pump and diesel engine fuel injection nozzle, direct injection diesel engine cylinder and the cylinder Canon of compressed air mixing, spontaneous combustion under high temperature and high pressure, forces the pistons to work. The engine is often called compression ignition engine. Petrol engine cars with high speed (cars use gasoline engine speed can be as high as 5000-5000 r/min, trucks with gasoline engine up to about 4000 RPM) light quality, working with low noise, easy starting, manufacture and maintenance cost low characteristic, therefore, in the car and, minivans and is widely used on military off-road vehicles. The deficiency is the fuel consumption is higher, and poor fuel economy. Diesel cars with high compression ratio, average about 30% less than Petrol engine car fuel consumption, so the better fuel economy. Such as the recently listed faw Volkswagen production TDI1.7 diesel cars than 1.6 litres of petrol cars 2 liter per hundred kilometers can save. General freight most used diesel engine. Diesel engine's weakness is speed was lower than those of gasoline engines (generally the highest speed in 2500-3000 revolutions per minute), quality, manufacturing and maintenance of the high cost of (because of the high fuel injection...
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...Ruvim korchuk Did you ever see a hybrid vehicle driving around? Amongst the sea of gasoline-powered vehicles, the hybrid cars stand out. For one, they don’t have an exhaust pipe that can be modified to be louder because they have certain specifications to run by. The physical characteristics of the hybrid car are not the only differences between the two types of vehicles. There are many differences between the two vehicles. Here are just two differences that impact the decision people make in purchasing a gasoline or hybrid vehicle: Maintenance, Environmental Factors, and Cost. First of all, maintenance is a big factor in purchasing a car because it is linked with time and resources. Hybrid vehicles run on huge batteries. Yes batteries are expensive, but don’t they outlast the gas lanterns on camping trips? Electric vehicles have less maintenance to do. Instead of maintaining a gasoline engine four times a year, a hybrid vehicle needs maintenance only once a year. If a person had a 10 year plan for his hybrid and gasoline vehicle, he would have to maintain his gasoline vehicle 40,000 times, while the hybrid needs only 12,000. That is 38,000 less oil changes! Now think about how much money you will save not only on money, but engine/transmission oil, and filters. Hybrid vehicle components require less maintenance because the technology for hybrid cars surpasses gasoline vehicles. Gasoline vehicles require more maintenance because they have fewer parts that have higher stress...
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...Question 1 : Everyone’s Gasoline Problem Gasoline prices are affected by the seasonality that is driven by the demand and supply patterns, as well as the local competition. The demand for gasoline increases during summer as people drive more due to favorable weather conditions. As the demand for gasoline increases, gas prices at the pump increases to earn more profits. From the graph, it is clear that the price of gasoline shot up to $4 a gallon in July 2008 (GasBuddy.com, 2011). This was mainly due to the increase in crude oil prices that was settled at $147 per barrel. However, in December 2008, the crude oil prices dropped to $40 a barrel as a result of which gasoline prices dropped to $1.69 a gallon. It seems that the record high prices encouraged people to drive less, which in turn drove down demand and subsequently, prices. Price increases generally occur when the world crude-oil market tightens and lowers inventories. Also, growing demand can sometimes outpace refinery capacity. In the spring, refineries perform maintenance, which can place a pinch on the gasoline market. By the end of May, refineries are usually back to full capacity (Bonsor, & Grabianowski). Local retail station competition also plays a considerable role in the fluctuation of gas prices. Since a neighborhood would have many gas stations, each station has to adopt equivalent pricing policy as any increase in gasoline price would cause the customers to migrate to an adjacent gas station...
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...SWOTT Analysis Paper- Honda-Fuel Falon Padron BUS/475 April 29, 2015 Yamil Guevara SWOTT Analysis Paper-Honda-Fuel The following documentation will analyze external, internal, and supply chain analysis that has been proposed for our new Gasoline, and gas station division manufactures by Honda Motors. A SWOTT tables has been added which represent the company’s strength, weakness, opportunity, threat, and trends. Relevant forces and trends will also be discussed in the following document. |SWOTT Analysis | |Strength |Weakness | |- Cater to a variety of vehicles. |Product Range. | |- New innovating signature Fuel. |Similar Competition. | |-Affordable gas price’s. |No Promotion advancements. | |- On site customer service. |Product accessibility. | |Opportunity |Threats ...
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