Is Junk Food Elastic or Inelastic?

The quantity demand for junk food with respect to price for me is inelastic. I know when the price goes up people will consume less junk food, however the decreasing demand is less than the increasing price. It is because the substitutes for junk foods (fast foods) is difficult to find by now, especially in US. The most fast and easy food to eat is junk food itself.  Based on “The Impact of Food Prices on Consumption: A Systematic Review of Research on the Price Elasticity of Demand for Food” journal, it says that “Price elasticities for foods and nonalcoholic beverages ranged from 0.27 to 0.81 (absolute values)”. We highlight that elasticities stated is less than 1%, so it is going to be inelastic. The idea behind this is that the buyer must buy the foods even if the price rises for 1%, because the demand will only reduce for lest than 1%. So we can know that price is not impactful toward the quantity demand in Junk Food.

This is Why Government Intervene The International Trade

The role of government is quite significant to intervene the trade in order to cope with inefficient activities in the economy. Inefficient activities include unequal distribution.

1. The function of the government to maintain internal security and defense. In order for citizens to conduct business activities with a calm and comfortable.
2. The function of the government to administer the judiciary, so that every citizen has the same rights and obligations.
3. The function of the government to provide goods not provided, so that citizens get easiness in running business activities. 

Despite all, the reason of government intervention can be classify as three main parts:

1. To correct market failures. Market is an unexpected things in our life; we cannot handle the market as it supposed to be. Therefore, to prevent any massive failure in the economic system, the role of government is really needed. There are several example of market failure such as immobility, public goods, demerit goods, merit goods, imperfect information, high relative poverty, and monopoly power in a market. Those market failure can bring some negative impacts such as structural unemployment, failure of market to provide pure public goods, free rider problem, over consumption of products with negative externalizes, consequences for consumers from poor choices, low income families suffer social exclusion, negative externalizes, higher prices for consumers, cause loss of allocate efficiency
2. To achieve a more equitable distribution of income and wealth. The reason of the government is that it is the power of each human being to gain more money to fulfill their need. Therefore, the government needs to distribute equal wealth especially to those people who live under economic condition.
3. To maximize the social prosperity. The role of government to intervene the trade is to boost the performance of the economy. Since, they will be able to compete with other countries from all over the world for the sake of good economic performance in the world. The role of government can also improve social welfare involving public welfare. Such as improving the function of public facilities. Thus, the government can utilize these facilities equally.
4. Socio-Economic Factors. Market interventions for socio-economic including labor laws to protect certain segments of the population and the setting up of certain products to ensure the health and well-being of consumers.

Real Estate Investment Analysis in Flagstaff, US at 2018

Flagstaff is the city that located in North America. Flagstaff located at an elevation under 7000 feet. The Flagstaff population grew almost 13,000 more than 65,000 inhabitants. The city of Flagstaff consists about 64 square miles excluding outlying areas. Flagstaff is located at the foot of the San Francisco Peaks and is surrounded by large pine forests, precisely located in the district of Coconino County, which is the second largest area in the United States that consisting of nearly 12 million hectares. In addition, the cost living in the Flagstaff is about 20% higher than the national average and the flagstaff area code is 928. After we visit the website in the realestate.com we find the property type that exist in Flagstaff are house, condo/town home, multi family, mobile or Mfd and land.  

Knowing the whole market is the important thing that we need to understand before analyze the investment in real estate. To begin with, the median home value in the united states is $220,100 according to the www.zillow.com. Based on Zillow predictions, the United States home values have raised up 7.6% in the last year and it will increase 6.4% within next year. It indicates the real estate in America is stable. In addition, the home value falls 20% in 2007- 2011 and make many homeowners are now underwater on their mortgages, which mean they owe more than their home is worth. Meanwhile, the median value in Arizona is $244,600 and the home values is going up 7.7% over the past few years and it will be increase 3.8 % based on Zillow prediction. In addition, foreclosures become the factor that impacting the home values in the Arizona. In the information also given that mortgages in Arizona is 0.7%, which is lower than the national value of 1.1% U.S. home values. Lastly, the median home value in Flagstaff is $366,600 and the Flagstaff home value going up 8.0 % in the past few years and will increase 5.9 %. Besides that, the homeowner of the Flagstaff only suffers 5,2% underwater mortgage and 0.4% delinquent mortgage.

The basic principle of investing in real estate is to gain profit compare to the cost to buy the real estate itself. The main reason of investing in real estate is basically a believe that population will increase while the land will generally steady in terms of area. Based on Labor Statistics of Bureau, the most expenditure by American is housing expenses. Therefore, invest the real estate is one of good choice especially in Flagstaff, AZ. The first reason is because real estate in Flagstaff has high and positive growth of real estate. Its property’s value increase overtime and this is good for all investors in real estate. To be more detail, according to Flagstaff Business News, the residential real estate in Flagstaff has jumped 38% since 2015. Moreover, they also predict that the growth of sales price average will increase slowly at least until 2022. Moreover, there is also a potential excessive demand of real estate in Flagstaff because according to U.S Department of Housing and Urban Development, Flagstaff has more than 1,500 demanded houses and 170 are under construction the price changes also averagely high around 20%.