Thursday, November 3, 2011

Taiwan Floods Affect Computer Market

Recent floods in Thailand are causing major economic ramifications in the United States.  Many companies such as Toshiba and Nikon have most or all of their manufacturing plants based in the region.  Flood waters have hit so many manufacturers that a shortage in laptops and cameras is expected during the first quarter of 2012.  A shortage is when a product is unavailable, and the quantity demanded is greater than the quantity supplied.  In this case, the quantity supplied of electronics will be drastically low, making even the normal amount of quantity demand seem high.  The problem is expected to be resolved by March, but the companies are still worried for their sales.  Natural disasters like floods are an always unexpected factor in the economy.  What was at one point a flourishing factory, can be leveled by a tornado, or burnt down by a fire.  Natural disasters also affect GDP.  If the Taiwanese workers are not able to go to work and make products then the GDP is bound to drop.  It will drop even more drastically if the multiplier effect is taken into account because the workers will also not have any money to put into other firms.  Natural disasters are terrible, but also portray many important economic ideas.

Paxton S.

No comments: