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Gina B | Why are prices still so high? |
If gas has went down, why are food and airline tickets still so high and unaffordable? Do you think gas will go back to $4.00 a gallon after the election tomorrow, and if so how soon? |
 |
 
mande
|
There are several reasons:
Supply and demand - it's a very complex set of circumstances that results in prices being a certain level, it's not always "if X is less, then Y should go down" or whatever.
The other obvious thing is, it takes a while for anything to make it's way to the end of the pipeline (literally and figuratively, in this case!), so it will take a while.
The other thing is, jet fuel is NOT automobile fuel!
It is a different product, so it may be the sort of thing where they have giant storage facilities for it, and they have to use up the existing (more expensive) fuel before the cheaper stuff starts showing up, etc.
There are too many factors to know for sure. |
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Mark
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it could very well happen. food and airline is because the airlines are making tons of money now that gas prices went down and food. the middle man makes most of the money on the food anyway.
gas may go back up after tomorrow and it will be interesting to see if it does |
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MConner
 |
for profit |
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Doctor Deth
 |
gas has only dropped over the last 2 months - it takes a lot longer for that to affect other parts of the economy |
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ignatz
|
Gas will go up again once the election is over. the oil co. know people will pay the price so they will do it again.
How soon, maybe after the holidays or sooner. hard to tell right now.
As for high prices, 2 reasons... 1. the holidays are around the corner and businesses often make the majority of their yearly income at this time.
2. the main reason is always the same, Supply & Demand.
They keep supply down when demand is high and so prices are high.
When demand goes down so do prices. That's one reason gas costs have come down.
It's all economics. |
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onestep_42
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Supply and Demand. |
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Howard L
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The phenomenon is called "sticky prices". Retailers and manufacturers are quick to raise prices when their costs go up but rather slow to reduce prices when costs go down. There are many economic articles and textbooks on the subject. |
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bigdaddy
|
They will go back up next summer when demand peaks again but I doubt as high as people have learned to conserve more.
As for prices on airlines and food they take longer to adjust as those industries took a beating by not reacting to rising prices fast enough. They should see a price drop in January if gas remains low |
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mnmshelly
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I think they just lowered gas just for the election and if obama wins every thing will go up higher then before. |
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