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In: Economics

A drought will reduce the production of canola oil. The impact on the canola market will...

A drought will reduce the production of canola oil. The impact on the canola market will be a leftward shift of _________.

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Expert Solution

Since the drought reduces the production of canola oil, this impact is represented by a leftward shift of the aggregate supply curve of canola oil.

It will lead to a fall in equilibrium quantity and increase in equilibrium price of canola oil.

Rahul Sunny answered 2 years ago
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