Question: Every summer, when the peach is in season, the price of peach is very low. However, the beach house rental price is very high in summer. Please apply the three-step approach to explain what happens in the peach market and beach house market.

Three-step approach

Analyzing Changes in Equilibrium: Three Steps

1. Decide whether this event shifts the supply or demand curve.
2. Decide in which direction the curve shifts.
3. Use the supply-and-demand model to see how the shift changes the equilibrium price and quantity (i.e., to figure out the new market equilibrium).