Question

In: Economics

What is the effect on the equilibrium in the apple juice market if apple juice becomes...

What is the effect on the equilibrium in the apple juice market if apple juice becomes less popular and a cheaper robot is used to pick apple? Make a graph or two graphs to illustrate the change (just focus on the effect of these 2 changes, and make assumptions when needed

Solutions

Expert Solution

Solution:-

Given that

As apple juice becomes less popular

demand for apple juice decreases

demand curve for apple juice shifts leftward.

As cheaper robot is used to pick apple more technologies advancement takes place profits increase supply increase supply curve shifts rightward.

Graphical flustration

Case I:

Assuming increase in supply is more than decrease in demand

Equilibrium shifts from E to E'

Equilibrium price falls

Equilibrium quantity rises

Case II:

Increase in supply < Decrease in demand

E shifts to E'

Equilibrium price falls

Equilibrium quantity falls

Case III:-

Increase in supply = Decrease in demand

E shifts to E'

Equilibrium price falls

Equilibrium quantity remians same

So we observe that with both the effects of equilibrium price of juice always falls however equilibrium quantity of apple juice may increase or decrease or remians same depending upon the magnitude of the shift of each curve.

Thanks for supporting***

Please give positive rating***

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

1. What is the effect on the equilibrium in the apple juice market if apple juice...

1. What is the effect on the equilibrium in the apple juice market if apple juice becomes less popular and a cheaper robot is used to pick oranges? Make a graph or two graphs to illustrate the change (just focus on the effect of these 2 changes, and make assumptions when needed) (33 points)

Suppose the market for frozen orange juice is in equilibrium at a price of $ 1.00...

Suppose the market for frozen orange juice is in equilibrium at a price of $ 1.00 per can anda quantity of 4200 cans per month. Now suppose that at a price of $ 1.50 per can quantity demanded falls to 3000 cans per month and quantity supplied increases to 4500 cans per month compute the elasticity of supply for frozen orange juice between prices of $ 1.00 and $ 1.50. Explain your answer 3 points), 2 Katherine advertises to sell...

Suppose the market for frozen orange juice is in equilibrium at a price of $2.00 per...

Suppose the market for frozen orange juice is in equilibrium at a price of $2.00 per can and a quantity of 4200 cans per month. Now suppose that at a price of $3.00 per can, quantity demanded falls to 3000 cans per month and quantity supplied increases to 4500 cans per month. Draw the appropriate diagram for this market. Calculate the price elasticity of demand for frozen orange juice between the prices of $2.00 and $3.00. Is the demand elastic...

_____ A certain brand of apple juice is supposed to have 64 ounces of juice. Because...

_____ A certain brand of apple juice is supposed to have 64 ounces of juice. Because the penalty for underfilling bottles is severe, the target mean amount of juice is 64.05 ounces. However, the filling machine is not precise, and the exact amount of juice varies from bottle to bottle. The quality-control manager wishes to verify that the mean amount of juice in each bottle is 64.05 ounces so that she can be sure that the machine is not over-...

A machine is used to fill Apple Juice bottles with juice. The machine has a known...

A machine is used to fill Apple Juice bottles with juice. The machine has a known standard deviation of ? = 0.05 liters. The target mean fill volume is ? = 2.0 liters. A quality control manager obtains a random sample of 50 bottles. He will shut down the machine if the sample of these 50 bottles is less than 1.95 or greater than 2.1. What is the probability that the quality control manager will shut down the machine.?

4. a. Orange juice and apple juice are known to be perfect substitutes. Draw the appropriate...

4. a. Orange juice and apple juice are known to be perfect substitutes. Draw the appropriate price-consumption curve (for a variable price of orange juice) and income-consumption curve. b. Left shoes and right shoes are perfect complements. Draw the appropriate price consumption and income-consumption curves

WHY Apple Ltd choose to entered the Thailand Market , and what is apple Ltd market...

WHY Apple Ltd choose to entered the Thailand Market , and what is apple Ltd market entry mode of the Thailand market? ( 400Words )

Question 1 Jane operates a company called “Fruity Shop”. It sells apple juice, orange juice and...

Question 1 Jane operates a company called “Fruity Shop”. It sells apple juice, orange juice and melon juice in boxes. Jane rents a retail space to sell these items and the cost of goods sold (COGS), selling price and daily demand for each item is given in the table below: Description COGS($) Unit Selling Price($) Demand Per Day Apple Juice $ 10.00 $ 14.00 400 Orange Juice $ 12.00 $ 15.00 300 Melon Juice $ 13.00 $ 16.00 250 The...

An ice chest contains 6 cans of apple juice,8 cans of grape juice,7 cans of orange...

An ice chest contains 6 cans of apple juice,8 cans of grape juice,7 cans of orange juice, and 4 cans of mango juice. Suppose that you reach into the container and randomly select three cans in succession. Find the probability of selecting three cans of grape juice.

. the contents of a sample of 26 cans of apple juice showed a standard deviation...

. the contents of a sample of 26 cans of apple juice showed a standard deviation of 0.06 ounces. We are interested in testing to determine whether the variance of the population is significantly more than .003. At 95% confidence, what is the critical value from the table?

Subjects