User 272270

Chevy Volt Debuts to Enthusiasm in California

This is simple high school knowledge- When there is a change in the supply schedule, occurring thought technological changes, or through changes in the business costs…An increase in technology or decrease in costs would have the effect of increasing the quantity supplied at each price, thus reducing the equilibrium price (in this case the Volt). On the other hand, a decrease in technology or increase in business costs will decrease the quantity supplied at each price, thus increasing equilibrium price. So the comparison between the computer and the Volt in regard to equilibrium price as I have stated is valid according to basic economic knowledge. If this price doesn’t come down- either business costs increased or there is a shortage in the market in which we would need to correct the disequilibrium, and the price of the good will be increased…which would then lessen the quantity demanded / increase quantity supplied thus that the market is now in balance. This is a fact, not theory or opinion…

Take a look at Hondas fuel cell car selling for 100k (or lack of selling)…it cost Honda nearly 2 million dollars…simple math = a loss on each FCX sold. So why do they keep building them? Re-read the paragraph above and now you understand why technologic advances are going to be a huge leap in making these new alternative cars more affordable. Now you understand why there is a good possibility that GM will also loose money when the Volt is actually being sold in the initial stages.