After reading chapter’s 1, 2, 3, and 5 in the text, I have learned about the principles of economics, trade-offs, supply and demand, quotas, and price controls. After a little research, I found an interesting article about natural gas. Although the text talks about natural gas at the beginning of the third chapter, I wanted to research this article to see how it compared or contrasted to the article. Our population should be concerned or interested in the topic of natural gas and its demand because it affects each and every person whether they think it does or not. Natural gas prices are the same for everyone. With this being the case, that means that whether or not someone uses a little amount of energy because they want to save money, the price will rise and fall depending on the demand and use of the whole population. Timothy Puko’s online article “Natural Gas Rises of Expectations” in The Wall Street Journal, which was posted on June 1st, 2016 describes the topic of Chapter 3: Supply and …show more content…
The spike in natural gas prices is caused by two things: supply and demand. All back in 2002, the U.S economy was in recession. This caused people and businesses to cut back on their energy consumption. This made the demand go down until 2006 when the economy shot up and rose again. All was good until hurricane Katrina hit the Gulf Coast where most of the natural gas supply came from. This made the demand rise and the supply lower to almost nothing, creating a huge problem. The text states that the supply and demand curve shift as one or the other, not both. When there is an increase in demand, the curve shifts right. This makes the price of natural gas increase and the supply increases which has an upward movement of the supply curve. When demand increases, usually the price increases. When supply increases, price may stay the same, but usually will