A Shift in Demand and Supply Paper Example

The supply and demand for goods and services fluctuate regularly. These goods and services are identified on a macroeconomic or microeconomic level according to how they affect society as a whole. With the recent increase of knowledge, as well as, products and services in the technology field, there have also been shifts in the supply and demand of the goods and raw materials that help maintain these technological advances.

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One of the many products that have continued to change and fluctuate in supply and demand in recent years is the battery. Since the invention of battery usage, cells have been developed, enhanced, and made more efficient, into cells we know and use today. The many different types of batteries offer different uses and capabilities. The lithium-ion battery is a lightweight, high energy battery that is ideal for portable devices. Although the lithium-ion battery is perfect for portable items, this type of cell is also used to different power forms of transportation, among other things.

After doing a significant amount of research about the economic status of the battery industry, it has become apparent that globally and domestically, we are experiencing a revolution within the battery industry. As adjustments are made to make batteries last longer, more energy efficient, and easily accessible and interchangeable, the supply and demand for these products has fluctuated dramatically. When new cells are introduced to the general public, the need for these necessary goods grows although the price may be significantly higher than if consumers waited until products could be manufactured at lower costs or until demand decreased. In recent years, the revolution of these batteries has produced the lithium-ion battery.

An article regarding the current status of the battery industry's economic standings shows an increase in the supply and demand of the lithium-ion battery in 2015. The report outlines recent agreements between XALT Energy and Chinese bus manufacturer for XALT energy to provide all lithium-ion batteries for all-electric buses in China. Although the supply for these batteries has increased, it also benefits additional economic issues as this agreement is allowing for the creation of three hundred new high tech and manufacturing jobs in Midland, Michigan. The batteries being manufactured are high-performance rapid charging batteries which can be recharged in ten minutes. Hybrid Kinetic (HK) Group, the Chinese company, working with XALT Energy in this agreement, explains that the cost for the goods is the main reason for their decision to work with XALT Energy specifically (XALT Energy, 2015). The graphs show an increase in the supply of a good causing an outward shift in the supply curve as well as a decrease in the price. As the main reason for the Hybrid Kinetic Group agreeing to work with XALT Energy to produce their constant lithium-ion battery demands, is cost, suggests that in addition to the increase of supply of the good, there is also a decrease to the price of the good, as well. This decrease in price will generally cause demands to increase their consumption while rates are low or lower.

After some additional research, it appears the supply and demand should continue to increase, even in upcoming years. Several articles suggest the need for the lithium-ion battery will continue to grow as the US continues to make agreements and contracts with both domestic and international companies and organizations to provide the demanded goods. As the demand increases both domestically and internationally, the application of good increases, the supply - as suggested - increases, and the price may increase as well as consumers are willing to pay a higher rate as the good becomes more in demand (Mier & Weissbart, 2019). As the lithium ion battery becomes more widely used than it already is, as projected about the market, new ways to make the battery more energy efficient, more portable, and longer lasting may cause prices to increase as cost of the raw materials needed to make these more efficient batteries could make the overall cost of the original product to be more than it currently is.

Conclusion

In summary, it is evident that with the coming age and the continued growth of the technology industry, there have to be so many new gadgets and capabilities for electronics, appliances, audio and visual entertainment, and even transportation. As the revolution of the battery has continued to develop, it has become apparent that the battery industry must continue to grow and succeed as the technology industry does, as so many of these technological advancements require or will require the use of some battery.

References

http://www.netmba.com/econ/micro/supply/curve/Mier, M., & Weissbart, C. (2019). Power Markets in Transition: Decarbonization, Energy Efficiency, and Short-Term Demand Response (No. 284). Ifo Working Paper.

XALT Energy Announces Lithium Battery Supply Agreement with Chinese Bus Manufacturer. (2015, March 26). Retrieved April 15, 2015, from http://www.altenergymag.com/news/2015/03/26/xalt-energy-announces-lithium-battery-supply-agreement-with-chinese-bus-manufacturer/36670