Ice+cream+sales

Link: http://www.highbeam.com/doc/1P2-4035999.html

Summary: Recent studies show that because of the economic recession, the sales of ice cream have risen. Turns out people tend to consume more ice cream when their depressed due to the economic recession. So Ice cream sales have risen in the US by 11.2 percent in the year of 2011. While the sales for ice cream increase, all other leisure spending decreases. Ice cream is the only leisure product that consumers tend to buy when they’re sad. Hence, ice cream sales heat up when the economy cools. Demand has risen up for ice cream in the past few years. This means less money is being spent on other leisure goods. This causes many companies to lose money and worsen the economy which is already in recession. While there was a 11.2 percent increase for ice cream in 2011, there was an almost equal amount of decrease in the sales of junk food.

Definition: 1. Microeconomics: A branch of economics that studies the behavior of individual firms or companies make as to how they best allocate scarce resources. 2. Demand: the desire of purchasers, consumers, clients, employers for a particular commodity or service. 3. Change in Quantity Demanded: A change in how much consumer is willing and able to buy, as a result of a change in price. 4. Macro economics: a branch of economics that focuses on all firms or companies. The overall economic picture. 5. Supply: how much a certain person or place can produce provided with the necessary materials.

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Evaluation: The solution to this economic event is quite simple. If the demand for ice cream were to decrease, there should be an increase in demand for other leisure goods. There are several ways of decreasing demand for ice cream. The government could place taxes on ice cream companies which would decrease the quantity demanded for icecream. One could also look at the root of the problem, depression, both in the economy and of the people. If there wasn’t an economic depression, people would be happier. If people are happier they will tend to buy less ice cream and balance out their leisure spending. Only time will tell if