Consider the following events that affect the market for oranges in the US. Suppose that both of these following events occur simultaneously: (i) the price of Apples (which is assumed as the perfect substitute for oranges) decreases; and (ii) bad weather and droughts that reduce the harvest of oranges by 60%. Based on the two scenarios provided, what would happen to the market for oranges in the US: O a. The equilibrium price of oranges could either increase or decrease, but equilibrium quantity will definitely increase. O b. The equilibrium quantity of oranges could either increase or decrease, but equilibrium price will definitely increase. O c. The equilibrium quantity of oranges could either increase or decrease, but equilibrium price will definitely decrease. O d. The equilibrium price of oranges could either increase or decrease, but equilibrium quantity will definitely decrease.

Consider the following events that affect the market for oranges in the US. Suppose that both of these following events occur simultaneously: (i) the price of Apples (which is assumed as the perfect substitute for oranges) decreases; and (ii) bad weather and droughts that reduce the harvest of oranges by 60%. Based on the two scenarios provided, what would happen to the market for oranges in the US: O a. The equilibrium price of oranges could either increase or decrease, but equilibrium quantity will definitely increase. O b. The equilibrium quantity of oranges could either increase or decrease, but equilibrium price will definitely increase. O c. The equilibrium quantity of oranges could either increase or decrease, but equilibrium price will definitely decrease. O d. The equilibrium price of oranges could either increase or decrease, but equilibrium quantity will definitely decrease.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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