For each scenario below explain how the supply or demand cur

For each scenario below, explain how the supply or demand curve would shift, and explain how the equilbrium price and quantity would change. Assume that each market always starts in equilibrium.

(a) Peanut butter market when the price of jelly increased.

(b) Lemonade market when firms have developed a new type of fertilizer that allows more lemons grown per tree.

(c) Fast food market when minimum wage increased.
(d) Coffee market after a report comes out that coffee lowers risk of heart disease.

(e) Pepsi market when Coke workers go on strike.

Solution

A. Demand for Peanut butter market will increase due to increase in price of Substitute goods. Demand curve will shift to the right annd Equilibrium price and Quantity will rise. B. Supply of Leminade will inccrease due to cost of input reduced. Supply curve will shift to the right and equilibrium price will decrease and equilbrium quantity will inccrease. C. Supply of fast food decrease due to increase in cost of input Supply curve will shift to t he left and equilbrium quantity will reduce and equilibrium price will increase. D. Demand for coffee increases with the favorable news regarding coffee. Demand curve will shift to the right annd Equilibrium price and Quantity will rise. E. Demand for Pepsi will increase due to Substitute goods not available. Demand curve will shift to the right annd Equilibrium price and Quantity will rise.