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A principle purpose of the market model is to show how equilibrium price and quantity will change as a result of some 'exogenous shock'--for instance,

  1. A principle purpose of the market model is to show how equilibrium price and quantity will change as a result of some 'exogenous shock'--for instance, an increase in demand causes equilibrium price and quantity to increase. Can you think of a real-world example of such a shock to which you could apply the market model to explain changes in price and quantity?

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