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The Pulp Market
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- Words:
- 923
- Submitted:
- Sun Aug 17 2003
... The Pulp Market a) At the beginning of 1995 the Euro price was almost the same as the dollar price relative to the pound. Throughout 1995 and 1996, the price of pulp was cheaper in Euros than dollars. However this changed at the end of 1996, and the Euro became increasingly more expensive for pulp until the end of 2001 when it was more than £100 more per tonne than pulp bought in dollars. This suggests an appreciating dollar and/or a depreciating Euro. b) i) There were two reasons why the price rose in 1999 and 2000. Firstly, there was an increased demand (an outwards shift on my supply and demand diagram from D1 to D2). This increase in demand was caused by fears of a disruption of supply caused by the computer bug problem anticipated for the Year 2000. The fact that this potential threat never materialising did not matter, as
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