Contemporary Issues in Economics Research Paper

Contemporary Issues in Economics - Research Paper ExampleTherefore, this paper will seek to explicate some of the main(prenominal) factors that determine the gunslinger prices, problems, causes and solutions.First and foremost, it is important to note that the supply and demand market place determines the worth(predicate) of fuel. This is because an increase in demand and a decline in supply will automatically forgo to a rise in price. On the contrary, if the demand goes down or there is an upsurge supply, hence the fuel price will automatically decrease. In case a retailer decides to market its bluster at a steep price without considering the pricing of the competitors, then consumers will go and buy gas from the competitor selling at lower prices. When this happens, the retailer will lose business due to the high pricing and this will compel him to lower his gas prices in order to be competitive and plead his customers (What Affects Fuel Pricing). Retailer competition also affects gas prices and this can be grasped by the differences in price on stretches of highways that have multiple gas retailers. When there are several choices that consumers can get hold of from then it boils down to more competition on the retailers. In as much as umteen retailers carry gas and oil from major oil corporations, they are independent merchants of the product. This implies that they have the freedom to crop the prices the way they so wish.Chevron Corporation asserts that, crude oil is merchandized on the global market fairish like agricultural products such as corn and wheat, and precious metals such as silver and gold. In recent times, the prices of crude oil have increased dramatically as a result of the emerging world demand and political instability in most of the oil producing countries (What Affects Fuel Pricing). rude oil is the most important raw material used in gasoline and other petroleum products production. Therefore, it plays an integral in determ ining the price of gasoline. Crude oil price may be up to half the cost of one