Using demand and supply analysis, apply supply and demand to the following scenario. The following facts describe the peanut and peanut butter industry:

Another hot, dry summer devastated the 2011 peanut crop. Although peanuts are typically planted between mid-April and June, farmers had to wait several weeks after that period for rain.

Many peanut butter producers looked for ways to cut costs in other areas, such as shipping and warehousing.

Because of the high price of cotton, some farmers had already planted cotton in place of peanuts.

The scorching heat and drought singed many peanut plants, leaving more peanuts to be processed for oil rather than used for peanut butter.

1. Explain the effects of these changes, using supply-and-demand analysis on both the peanut and the peanut butter markets.
2. Droughts of all kinds have occurred since the beginning of time. In your initial response, relate Jeremiah 17:8 to the concept of supply and demand.

Jeremiah 17:8

They will be like a tree planted by the water

that sends out its roots by the stream.

It does not fear when heat comes;

its leaves are always green.

It has no worries in a year of drought

and never fails to bear fruit."