Application of Supply and Demand While reading the article titled "Solar Power has record year despite bankruptcies" published by CNN on March 14, 2013, I found that the demand of solar power has increased due to the falling prices. There has been a seventy-six percent increase in the use of solar power since 2011. The reason for the decline is from the fall in the price of solar panels, tax incentives, and a better alternative. The price of solar panels has declined by a staggering sixty percent. The fall is because of the decrease in the price of silicon which is one of the key ingredients for solar panels. The fall in the prices for solar panels has also created many companies to draw bankruptcies. However the falling prices will be a huge plus for consumers and for companies that specialize in the installation and sales of these solar panels. The price for the new solar energy though is still more than natural gas accept in a few states.
Questions
The market for solar energy and solar panels is being discussed in this article. Because of the fall in prices and because of the taste and preference for cleaner energy more people are buying solar energy which is causing the demand curve to shift to the right while the supply curve stays the same. Also the craze for a clean and an alternative power source has increased demand. With the growing awareness of global warming more and more people are looking for a change. Those citizens are willing to pay more money to know they are getting a cleaner source of energy. Next those same people will experience a tax cut because of their wishful spending. The thought of saving some money on taxes will instantly draw consumers in. Experts believe that the price will continue to decline in the coming years because of the falling prices of the goods used to make the solar panels. The less money that manufacturers need to produce a product the cheaper the