Chapter 2

‘The death of the electric car’

Link: http://news.bbc.co.uk/2/hi/uk_news/magazine/5245036.stm

Summary

In the past, the electric car was viewed as a futuristic solution to our air pollution, and to our over consumption of oil. But now that the dream of an electric car has become a reality, why does it still seem to be just a fantasy? General Motor actually came up with a decent eclectic car that could do 0-60mph in less than 8 seconds, with a top speed of 80mph, and has over a hundred mile range. In this article, it explained why the electric car didn’t take off as it was expected to. In a documentary entitled, “Who Killed the Electric Car”, Chris Paine, the maker of the film, blames the death of the electric car on “cynical and conspiring car makers and oil firms, as well as apathetic consumers and weak government and regulators”. Even though “weak government and regulators” and a part in the “demise of the eclectic car”, it was mostly due to the extremely limited customer acceptance of the car. Factors that were to blame for this were the price, the short lived batters, the heavy weight, and the “hideous appearance”, a comment that was made by Lindsay Tosh. Since electric cars were not taking off as they were expected to, companies like ford are promoting hybrid cars, cars that use both an electric motor and petrol engine, to conserve gas. The energy created from braking charges the battery for the motor in hybrid cars. But just like the electric car, “there are image problems for hybrid cars and a lack of incentive for people to move away from petrol-only cars”.

Relationship to Ch.2- Supply and Demand

This article relates to many topics covered in chapter 2, including supply and demand. Because there was hardly any demand for the electric car, supply and the price was affected. The relation between supply, demand, and the price are all interconnected. The low quantity demand for the cars gave it a higher price, because it would be more expensive to produce the cars in lesser quantities. Although hybrid and electric cars are an alternative to cars that use gas, isn’t high enough for consumers to start seriously thinking about switching. Oil is a still inelastic because there aren’t any good alternatives to it, electric and hybrid cars may save a couple dollars on gas, and it is more of an inconvenience to switch.

Chapter 1

‘Scarce fresh water an investment boon’

Link:

http://www.canada.com/edmontonjournal/news/business/story.html?id=60e8a4c1-b733-4f96-a85c-d723c1f4e221

Summary

Usable water has become even more valuable than oil, with over 70 percent of the world’s surface area is covered with water, how is that even possible? Unfortunately, 98 percent of the world’s water is saltwater, with only two percent as usable freshwater. Even worse, of the two percent that remains, only one percent of it is accessible, through lakes, rivers, and streams. The rest of the water is frozen in the polar ice caps. “The lack of usable water worldwide has made it more valuable than oil. The Bloomberg World Water Index of 11 utilities returned 35 per cent annually since 2003, compared with 29 per cent for oil and gas stocks” Water prices are only predicted to go higher and higher. As the world continues to grow, more resources are consumed. For example, an increase in population would need an increase in meat, and to produce more meat, there must be vegetation for the animals, and to grow more vegetation, it requires more water. Not only is freshwater used for human consumption, but also in industries, and largely in agriculture. The use for freshwater may rise 22 per cent by 2025, compared to 1995. “The United Nations estimates that by 2050 more than two billion people in 48 countries will be short of water.” Because of the growing need of fresh water, revenues in investment of water are expected to only increase; currently the water industry generates about $450 billion in revenue annually, following behind electricity and oil.

Relationship to Ch. 1 – Resources (land) and Scarcity

In chapter 1, we learned about the basic concepts of economics. The scarcity of a resource, like water, is a one of the most important concepts of economics. Without scarcity, there wouldn’t be any point of studying economics. Because there is a need or a demand for freshwater, and because there is a limited supply, there is a value on it, a value that will only continue to increase. Everyone needs water, it is essential to our lives. Even though in Canada, with our large chunk of the world’s water supply, for only one percent of the world’s population, we could still face a water crisis. Because of our extensive use of water for domestic, industrial and agricultural purposes, the supply of water could still not be enough to be sustainable in the future. We, as citizens of this world, each have a duty to conserve our resources as best we can.