Under the current possible swine flu crisis, demand for pharmaceutical goods has shot up significantly. This surge in demand is especially so for face masks which help to keep out germs that spread via water droplets expelled when a person coughs or sneezes. According to Straits Times report, at the Watsons store at Serangoon Central, it sold 30 masks on 27 April 2009, as compared to only five on 26 April 2009. And almost 150 face masks were sold over the past three days at the Watsons store at Parkway Parade, from one or two a day.
As marked by the statistics, under the threat of a possible epidemic (Swine Flu), the demand curve for face masks has shifted to the right as denoted by the graph (from DD to DD1), as people are willing to take necessary precautions to reduce the probability of contracting the flu from sick individuals. As the threat of swine flu becomes more imminent, and the government steps in to promote the use of face masks, the demand curve is likely to continue shifting to the right (DD2). The suppliers, responding to the current trend of consumption, are likely to increase the supply of face masks. Moreover, due to the ease of production and short time taken in production, producers could easily adapt to this change in demand rapidly. In other words, the supply will increase as shown by the shift of the supply curve to the right (SS to SS1). The shift by both the demand and supply curves to the right will result in the increase in quantity of goods, with its price indeterminate.
As marked by the statistics, under the threat of a possible epidemic (Swine Flu), the demand curve for face masks has shifted to the right as denoted by the graph (from DD to DD1), as people are willing to take necessary precautions to reduce the probability of contracting the flu from sick individuals. As the threat of swine flu becomes more imminent, and the government steps in to promote the use of face masks, the demand curve is likely to continue shifting to the right (DD2). The suppliers, responding to the current trend of consumption, are likely to increase the supply of face masks. Moreover, due to the ease of production and short time taken in production, producers could easily adapt to this change in demand rapidly. In other words, the supply will increase as shown by the shift of the supply curve to the right (SS to SS1). The shift by both the demand and supply curves to the right will result in the increase in quantity of goods, with its price indeterminate. Done by: Jun Xian
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