In the market in which you just participated, a seller only incurred a cost if she...

In the market in which you just participated, a seller only incurred a cost if she actually sold an orange. Assume instead:

Each seller brings oranges to market
Each has already paid for the oranges she brings
She can always bring unsold oranges to tomorrow’s market, where demand is expected to be stronger.

If you are a seller, how does this change affect your behaviour?
In a market described by these new assumptions, what do you predict will happen to the price?

Solutions

Expert Solution

Because the expected demand would be stronger tomorrow, the price will increase and disc and bring in more profits for selling oranges tomorrow than today as a result of which the behaviour can actually be altered in such a way that the number of oranges sold today would be less because of the increase in price today as any how they would be sold at a higher price tomorrow due to the increase in the expectation of demand etc. This new a Junction that the demand will increase might increase the prices on the whole as the expectation is such a way that the demand curve will shift to the right and the price will increase

Rahul Sunny answered 1 year ago

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