1.) Discuss and illustrate with a graph how each of the following events will af

Question

1.) Discuss and illustrate with a graph how each of the following events will affect the market for coffee
a.) a blight on coffee plants kills off much of the Brazilian crop
b.) The price of tea declines
c.) Coffee workers organize themselves into a union and gain higher wages
d.) coffee is shown to cause cancer in laboratory rats.
e.) Coffee prices are expected to rise rapidly in the near future.

2.) Indicate which curve shifted-- and in which direction--for each of the following. Assume that there is only one curve shift.
a.) The price of furniture rises as the quantity bought and sold falls.
b.) apartment vacancy rates increase while average monthly rent of apartment declines.
c.) The price of personal computers continue to decline as sales skyrocket.

Explanation / Answer

a.) a blight on coffee plants kills off much of the Brazilian crop -supply goes down, so quantity demanded goes down (redraw supply to the left) b.) The price of tea declines -demand goes down, quantity supplied goes down (redraw demand to the left) c.) Coffee workers organize themselves into a union and gain higher wages price goes up = supply goes down = same as b d.) coffee is shown to cause cancer in laboratory rats. demand goes down = same as b e.) Coffee prices are expected to rise rapidly in the near future. short term demand spike, long term nothing happens 2.) a.) The price of furniture rises as the quantity bought and sold falls. -demand curve shifts inwards b.) apartment vacancy rates increase while average monthly rent of apartment declines. -demand curve shifts inwards c.) The price of personal computers continue to decline as sales skyrocket -could be no shift, can justify either.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.