Any Economists out there?

Hello,

I have a data question for economists out there, I just wanted some help answering it. It's a bit long so if you want you can just skim over it.

During 2003, the prices of nickel rose from under $8000 to over $14000 a tonne. Two thirs od the worlds output of nickel goes to the production of stainless steel, used for products such as cutlery and kitchen sinks. the factor that influenced the price of nickel included: a strike by workers at a large nickel mine in Canada. the mine normally produces 9% of the world output of nickel. 9000 tonnes of nickel production was lost each month for several months.
Early in 2003, Russian producers sold 36000 tonnes of nickel from their stockpile, which was the largest in the world in 2003. in China, surging output of stainless steel affected the nickel market.

Speculative demand also affected the market. When speculators believe prices are going to rise, they buy the commodity in order to make a profit by selling at a higher price in the future. In the nickel market, changing demand conditions and running down of stocks led to speculative activity in 2003. Stocks had been only buffer in the market stabilising the price of nickel.
Market traders expect the price of nickel to grow in 2004, as the wprld economy continues to grow and production falls due to lack of new mines and dwindling supplies in exisiting ones. In the 1990s, mining companies bet on new technology lpwering the cost of extracting nickel from ores found in tropical soils. But innovation failed to live up to expectations and the new mines in developing countries are not expected to star production for at least another 2 years, leaving the market short of nickel in 2004 and 2005. steel makers are also seeking alternativs to nickel in an effort to deal with rising prices and undersupply.

1) With the help of Diagrams and the information in the text, distinguish between those factors affecting demand for nickel and those affecting supply of nickel.

2) Analyse and explain the possible effect of steel producers finding alternatives for nickel on the production of nickel.

Thanks

Reply 1

Neville 'Facking' Bartos

Do your own homework

Reply 2

shs9001

lol

Reply 3

Neville 'Facking' Bartos

Must have took a while to type that all out.

Reply 4

ttocserp

its bit late is this in for tomorrow, blame it on china and that a speculative bubble may have been produced which may be from a misconception that there was too little investment 3 years ago, blah blah blah, that really isn't much help but im bored

Reply 5

danny111

what a pointless piece of **** hw.

Reply 6

kicka

in order to help you, please let me know what's the length of the answer are you looking for?
do u need other references for question 2 or just improvise from the info given??

Reply 7

vandiola

I've kind of answered question 1 and its a page long (it's worth 6 marks). And I'm really confused by question 2, it's meant to be 10 marks. I don't think you need any references, apart from the information given to you.

Reply 8

Pistolopete

I have this set aswell :frown:

Can anyone give me any help on this? I don't see how you can write 10 marks worth on how it will affect the production of nickel. Demand for nickel goes down and so Supply of nickel goes down! What else is there to say? Thanks.