There are two articles in today's issue of The Wall Street Journal that can provide some insight into consumer behavior and price theory.
The first article reports that the incentive to switch to a hybrid vehicle is diminishing, first due to expiring tax credits, and second due to falling fuel prices. Both of these will essentially make it more expensive to "go green." With some of the information provided in the article, you could ask students how long it takes to recoup the "hybrid premium", the extra amount paid for buying a hybrid vs. a comparable traditional engine vehicle. Without the tax credit and with falling prices reducing the cost of driving, the payback time is stretching out. Questions for the students: Does this affect your decision-making when buying a car? Would taking a long-term view about energy prices in general change your decision?
The second article reports on the fact that the economic slowdown is causing a shift in consumer behavior in the supermarket. In an effort to stretch their incomes, people are abandoning brand loyalty and going with cheaper brands or store brands. Questions for the students: Can we graph this behavior to get a better sense of what's going on? Are we seeing shifts in the demand curve or movement along the curve?
What do you think? Are there other ways to use these articles?