Please take your time and try to complete on a piece of paper but anything is fine. Thank you!

Caonsider again the market for quinoa. The changes shown in Figures 8.10a-c can be analysed as shifts in demand and supply. 1. Suppose there was an unexpected increase in demand for quinoa in the early 2000s (a shift in the demand curve). What would you expect to happen to the price and quantity initially? 2. Assuming that demand continued to rise over the next few years, how do you think farmers responded? 3. Why did the price stay constant until 20077 4. How could you account for the rapid price rise in 2008 and 20097 5. Would you expect the price to fall eventually to its original level? 90 Ecuador 80 Peru Bolivia 70 60 50 Production of quinoa (thousands of tonnes) 40 30 20 10 0 2001 2003 2005 2007 2009 2011 Year Figure 8.10a The production of quinoa. 1,400 Bolivia 1,200 Peru 1,000 800 Price of quinoa ($/tonne) 600 400 200 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Year Figure 8.10b Quinoa producer prices.50 [ All other countries B United States B canada 40 W cu-27 Import demand for quinoa ($ millions) 2001 2003 2005 2007 2009 2011 Year Figure 8.10c Global import demand for quinoa