Offer and demand

Instructions

Review in the study material of this module what is related to the concepts of supply, demand, equilibrium, changes in demand, changes in supply and their determinants.Then, analyze each situation separately to determine the relationship between what is presented in the particular situation and these concepts studied.

1 Read each of the following financial situations carefully and work them separately:

a In your country, a health problem associated with a coronavirus has been unleashed.As a result of the situation, the number of consumers wanting to purchase hand sanitizer has increased in that season.

b Following a recent atmospheric phenomenon, a large amount of the fruit crop was destroyed simultaneously with the arrival of the high season of gastronomic events.

c The costs associated with the consumption of electricity in the production process have been reduced considerably, together with the entry into the market of 10 new companies dedicated to food production.

2 For each situation, make a graph where you represent the intersection of the demand and supply curves to establish the equilibrium point, the price and the quantity of the initial equilibrium.

3 Analyze each situation and identify the curves you must move to find the equilibrium point, the price, and the quantity of the final equilibrium when comparing it with the initial equilibrium.

4 After making and analyzing the graphs, you should evaluate each situation in terms of:

a The effect on demand (increases or decreases)

b The effect on supply (increases or decreases)

c The effect on the equilibrium price and quantity (increases or decreases)