Asked by Fallon Elise on May 04, 2024
Verified
The market for lemonade is in equilibrium and the price of lemons rises.In the lemonade market _____ will _____,_____ the price and _____ the quantity.
A) demand;decrease;decreasing;decreasing
B) demand;decrease;increasing;decreasing
C) supply;increase;decreasing;increasing
D) supply;decrease;increasing;decreasing
Lemonade Market
A hypothetical or real market scenario used to explain basic economic concepts, often involving the buying and selling of lemonade.
Lemons
A bright yellow, acidic fruit commonly used for its juice, zest, or as a garnish in cooking and baking.
Supply
The total amount of a good or service available for purchase at all possible prices in a given market, at a given time.
- Differentiate between changes in quantity supplied and demanded (movements along the curve) and changes in supply and demand (shifts of the curve) in market analysis.
- Grasp the implications of input cost changes on the balance of market equilibrium.
Verified Answer
NT
Navneet ThaandiMay 05, 2024
Final Answer :
D
Explanation :
When the price of lemons rises, it becomes more expensive for producers to make lemonade, leading to a decrease in supply. This decrease in supply, with demand remaining constant, results in an increase in the price of lemonade and a decrease in the quantity sold.
Learning Objectives
- Differentiate between changes in quantity supplied and demanded (movements along the curve) and changes in supply and demand (shifts of the curve) in market analysis.
- Grasp the implications of input cost changes on the balance of market equilibrium.