The price-reduction effect

This price mechanism is the centrepiece of Levitt s (1983) globalisation hypothesis, in which the consumers capitulate to the attraction of lower prices of foreign products and abandon their initially preferred innovation design. Consumers in the 

Different price increases of the two goods can occur as well and result in the same mechanism but this case should be an exception as a mechanism of the international diffusion of innovations. 

During the substitution process the indifference curve is switched (from hago to Iiagi), because of an income effect that accompanies the substitution effect. The income effect means that the nominal decrease of the price of one good increases total utility, see Deaton, Muelbauser (1980, p. 35-36). 

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Figure 3-3 Price paths of the price reduction effect...

The emissions reduction effects are caused in part by a reduction in UK output - a combination of a change in the share of the UK market held by UK producers and of weaker demand from consumers as a consequence of higher prices. They are also caused by investment in carbon-efficient technologies. Most of the emissions reduction is attributable to greater carbon efficiency, driven by the carbon abatement curves prepared for The Carbon Trust by Ecofys. Only in the steel and cement sectors does output reduction contribute to a significant carbon reduction. 

The principal worldwide manufacturers of nylon resins are given in Table 6. Total sales of nylon plastics in the United States and Canada in 1993 were 331,000 metric tons (37). West European sales were 352,000 t and Japanese sales 220,000 t (37). Figure 7 shows how sales in the United States have steadily increased since 1967 (38) and also how the price of nylon-6,6 has changed (39). The effect of the oil price rises, the boom of the mid-1980s, as well as the oil price reduction and the recession that followed are clearly evident. Table 7 shows the variation of price across different polyamide types. 

For example, sulfur emissions from utility power plants in the United States are subject to an emissions cap and an allowance-trading system established under the Clean Air Act. An effective cap on annual sulfur dioxide emissions took effect in 2000, so no more than 8.95 million tons of SO can be emitted annually. Utilities that want to build another coal plant must purchase sulfur emission allowances from others who do not need them. This system provides a market incentive for utilities to reduce their sulfur emissions as long as the cost of such reductions is less than the price of purchasing the allowances. 

Reduction or elimination of duties and taxes for both generic and patented essential medicines contribute to price reduction. In developing countries, the final price of a medicines may be two five times the producer or importer price. This reflects the effects of multiple middlemen, taxes of over 20% in some countries, pharmaceutical import duties up to 65%, high distribution costs, and pharmacy and drug seller charges. 

For non-inferiority, the first step involves defining a non-inferiority margin. Suppose that we are developing a new treatment for hypertension and potentially the reason why the new treatment is better is that it has fewer side effects, although we are not anticipating any improvement in terms of efficacy. Indeed, suppose that we are prepared to pay a small price for a reduction in the side effects profile say up to 2 mmHg in the mean reduction in diastolic blood pressure. 

Pressure sensors that give temperature-corrected, linear, analog voltage output are available from Motorola and other manufacturers. In such sensors, the on-chip electronics correct any temperature effects and nonlinearities in the output of the piezoresistors. The on-chip electronics replace a shoebox-size collection of printed circuit boards. The price of this kind of smart sensor is considerably less than 100. The integration of a large amount of circuitry on the chip allows functions like amplification, offset correction, self-testing, autocalibration, interference reduction, and compensation of cross-sensitivities (6). 

Although this technology is effective in resolving a wide range of polyatomic interferences, the increased cost associated with this type of instrumentation (more than twice the price of a quadrupole instrument) limits its use in most routine laboratories, hence alternative methods of interference reduction have been sought for. The use of chemical extraction and chromatography (in order to separate the analyte from the matrix prior to analysis) or the operation of the ICP-MS under so-called cool plasma conditions, allows the elimination of... 

Establishing a storage facility at Ninotsminda may open for reductions of the import price of gas from Russia. It is, however, uncertain and difficult to estimate how much lower the price for gas purchased during summer for injection into the storage may be. But if the summer gas price is approx. 5% lower than the winter price, the total effect on the consumer tariffs after establishment of gas storage may be neutral. 

External costs is an economic concept, which gives the possibility of setting the prices right. External costs are the cost involved by the rest of the lifecycle of products and by-products and not accounted for in present cost calculations. For example, the price of fossil fuels depends not only on exploration costs but also on the costs involved by the production of C02 and resultant adverse climatic effects, which will be many trillions of dollars. In an article in Nature the value of the world ecosystem services is estimated to be worth 33 1012 per year (19). This means that for economic activities that destroy part of the ecosystem, the ecoval-ue (service) reduction should be accounted for. 

Figure G-10 illustrates the considerable sensitivity of the cost of hydrogen from electrolysis to the price of input electricity. Each 1 cent reduction in the price of electricity reduces the cost of electrolytic hydrogen fuel by 53 cents/kg, or more than 8 percent per penny. Effective utilization of electrolysis as a fueling option will involve the cooperation of utilities and rate-making bodies.

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