Friday, March 19, 2010

Derivation of the Supply Curve in AP Microeconomics

Summary: Prices of coffee and deforestration.

Many third-world countries export coffee as their main export. In this graph, I've plotted data on prices paid to coffee growers in Indonesia and the percent of forest area lost in a national park that lies in a coffee-producing region.

This data is from, Caffeine and Conservation by Timothy G. O'Brien. I intended to show that as prices increase, incentives to produce more coffee at the expense of national park land increases. This is exactly what the supply curve in AP Microeconomics captures.

About the Author: Mike Fladlien is an AP Economics teacher from Muscatine High School in Muscatine, IA. He is an author, and also publishes the Mikeroeconomics and iMacroeconomics VB blogs.


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