The above reflects the short-run supply and demand for honey... which is a norma

Question

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the following:

a) An fall in population (of consumers)

b) A mysterious illness begins killing bees (but the honey itself is perfectly safe so consumers are not worried)

Graph 8

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the following:

a) An increase in the productivity of bees (more honey per beehive), and

b) A fall in consumer income

None of the above

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the following:

a) An increase in the productivity of bees (more honey per beehive), and

b) A tax on the production of honey

Graph 7

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the following:

a) An increase in wages for workers on bee farms, and

b) A mysterious illness begins killing bees (but the honey itself is perfectly safe so consumers are not worried)

Graph 7

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the following:

a) An increase in wages for workers on bee farms, and

b) A study reveals that honey is very healthy

None of the above.

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures the imposition of an effective price ceiling on honey.

Graph 5

The above reflects the short-run supply and demand for honey... which is a normal good. Which graph best captures what happens after an effective price floor is placed on honey.

None of the above. Graph 5 Graph 6 Price Price Q,?Q Quantity QQuantity Graph 7 Graph 8 Price Price Q,?Q Quantity Q, Quantity

Explanation / Answer

1).

Here “a fall in the population”, => a fall in the market demand for “honey”, => the demand curve will shift left side to “D2” on the other hand “a mysterious illness” lead to reduce the size of bees, => the produce of “honey” will be reduced, => the supply of the honey will shift to the left side to “S2”.

=> It correspond the “Graph-6“.

2).

Similarly, “an increase in the productivity of bees”, => the supply of honey will increase, => the supply curve will shift to the right side to “S2”, on the other hand “a fall in consumer income”, => decrease in the demand for honey to “D2”.

=> It correspond the “Graph-5“.

3).

Now, “an increase in the productivity of bees”, => the supply of honey will increases, => the supply curve will shift to the right side to “S2”, on the other hand “a tax on the production of honey”, => decrease in the supply of honey. So, here the 1st incident leads to increase in “S” and the 2nd incident leads to decrease in “S”, but don’t have any effect on “D”.

=> It correspond the “None of the above graphs“.

4).

Now, “an increase in wages for workers on bee farms”, => the production cost of honey will increase, => the supply of honey will decrease, => the supply curve will shift to the left side to “S2”, on the other hand “a mysterious illness”, => decrease in the supply of honey. So, here the 1st incident and the 2nd incident leads to decrease in “S”, but don’t have any effect on “D”.

=> It correspond the “None of the above graphs“.

5).

Now, “an increase in wages for workers on bee farms”, => the production cost of honey will increase, => the supply of honey will decrease, => the supply curve will shift to the left side to “S2”, on the other hand “a study reveals that honey is very healthy”, => increase in the demand for honey.

=> It correspond the “Graph-7“.

6).

Now, as we know that a price ceiling will be effective if and only if it is below of the equilibrium price, a effective price ceiling leads to excess demand in the honey market, => at the ceiled price D > S. So here these 4 fig can’t capture this incident here.

=> It correspond the “None of the above graphs“.

7).

Now, as we know that a price floor will be effective if and only if it is above of the equilibrium price. A effective price floor leads to excess supply in the honey market, => at the floor price S > D. So here these 4 figs. can’t capture this incident here.

=> It correspond the “None of the above graphs“.

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