By year 4 the supply curve will REMAIN UNCHANGED SHIFT LEF

By year 4 , the supply curve will (REMAIN UNCHANGED / SHIFT LEFT / SHIFT RIGHT) and will (HAVE THE SAME ELASTICITY / BECOME LESS ELASTIC / BECOME MORE ELASTIC)

The price of chocolate is greater after (ONE YEAR / FOUR YEARS)

Need help with every answer please, thanks very confuse on what to do.

An article in the Wall Street Journal descibed the production of cocoa beans used to make chocolate in African countries such as Chana and Ivory Coast. The article explained that when prices of cocoa beans rise it can take between two to four years for new trees to produce the pods in which the beans are grown Source: Alexandra Wexler, \"Chocolate Makers Fight a Melting Supply of Cocoa,\"Wall Street Journal, January 13, 2016 If the demand for chooolate were to increase, all else equal, would you expect the price of chocolate to be greater after one year or after four years? Suppose the figure represents the market for chocolate, where demand increases from Do to DD4 Assume s represents the supply of chooolate after one year The market equilibrium after one year will be where B. anywhere along D Do By year 4, the supply curve will The new market equilibrium after 4 years will be where OA. D4 intersects S1. C. Do intersects S D. D4 intersects D

Solution

• The market equilibrium after one year will be where D1 intersects S1.

Answer-option C

• By year 4, supply of choco beans will increase as it takes between 2 to 4 years for new trees to produce pods in which the beans are grown. This will also increase the supply of chocolate by year 4. Therefore, the supply curve will shift Right, and will become less elastic because it may be difficult for cocoa beans growers to expand their output and increase their use of factors of production such as land and capital.

• The supply curve shifts from S1 to S4 by year 4. The new market equilibrium after 4 years is where D4 intersects S4.

Answer- option B

• However, at new equilibrium, price is less than that was after 1 year i.e. at initial equilibrium(where D1 intersects S1) price is higher than it is now at new equilibrium.

Answer- After one year