Gold prices climb to near 3-week high on safe-haven demand
The article reports the increase in price of Gold- also considered to be the preferred choice of ‘Safe Haven’ – because of the deteriorating demand for other financial products.
Topics include Opportunity cost, Substitutes, Cross Price Elasticity of Demand, and Inelastic and Price Elasticity of Demand. Use the definitions, formulae and Gold market diagrams to explain how the inelastic nature of demand for gold and increase in its preference compared to other products has resulted in high market price for Gold.
Evaluation will cover analysis of risk averse sentiment followed by week economic indicators and uncertainty in the market. Examine the interplay of the forces of demand for Gold and other substitutes in short term and long term.