For the following scenario, draw the corresponding graph and clearly show how the scenario affects the supply and demand graph and the resulting outcome on the equilibrium price and quantity:

1. The market for Beefalo Meat

A. A new study on the health benefits of beefalo meat has caused people to prefer more beefalo meat.

B. A rare disease that targets beefalos has devastated the beefalo population.

C. A new study on the health benefits of beefalo meat has caused people to prefer more beefalo meat and at the same time, a rare disease that targets beefalos has devastated the beefalo population.

For the last two questions, you are just concerned with the effect on equilibrium price and quantity of the two scenarios taken together.With these questions just state what changes (demand or supply), how it changes (increase or decrease), and the effect on equilibrium price and quantity.Note that you do not have to provide graphs for these problems (but please feel free to graph out the solution if it helps you).An example is provided for you below:

Example: The market for nice cars

A.The price of steel used to make nice cars (a normal good) has increased.

B.The general income level of the population has decreased.

Answer:

A.S: Q P

B.D: Q P

Q P?

2.The market for peanut butter

A.The government removes a tax from the production of peanut butter.

B.The price of jelly has decreased.

3.The current market for flash drives

A. Advertisements announce that flash drives will be half-price next week.

B. Improvements in technology have made flash drives easier to make.