Asked by Aleya Smith on May 23, 2024
Verified
Use supply and demand analysis to explain what is most likely to happen to the price and quantity of pink salmon when there is a large increase in the supply of pink salmon due to technological improvements in fishing boats that make them larger and more efficient and at the same time there is a small decrease in demand for pink salmon as consumers' tastes change to preferring other kinds of fish.
Supply and Demand Analysis
A fundamental economic model that explains how the price and quantity of a good or service are determined in a market, based on the relationship between the supply of the good and consumer demand.
Technological Improvements
Innovations and advancements in technology that increase efficiency, productivity, or bring new products, often leading to economic growth.
- Discern and interpret the elements that determine market demand and supply.
- Discuss the influence of federal regulations, such as tax policies, price ceilings, and price floors, on the state of market equilibrium.
Verified Answer
AS
Arjun SubramanyamMay 25, 2024
Final Answer :
The supply curve will shift to the right due to the change in technology that has brought about the larger, more-efficient boats. The demand curve will shift to the left since people's tastes have changed to other kinds of fish. Since there is a larger increase in supply than the decrease in demand, the equilibrium price will fall and the equilibrium quantity will rise.
Learning Objectives
- Discern and interpret the elements that determine market demand and supply.
- Discuss the influence of federal regulations, such as tax policies, price ceilings, and price floors, on the state of market equilibrium.