A severe freeze has once again damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of

Use letters in alphabetical order to select options

A

both the supply and demand curves.

B

the demand curve, as consumers try to economize because of the shortage.

C

the supply curve.

D

the supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price.

Question

Business

Noelle Vargas

3 March, 04:23

A severe freeze has once again damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of

Use letters in alphabetical order to select options

A

both the supply and demand curves.

B

the demand curve, as consumers try to economize because of the shortage.

C

the supply curve.

D

the supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price.

+2

Answers (1)

Know the Answer?

Devon Dickerson · Answer 1

C. Supply Curve

Explanation:

Supply : Quantities sellers are able & willing to sell at a price, period. Determinants : Price (price supply direct relationship - upward sloping curve), Inputs Price, Other goods price, Technology, Govt Policy, Seasonal factors.

Change in supply due to Price is 'Change in Quantity supplied', leads to movement along the curve. Change in Supply due to other factors is 'Change in Supply' & shifts the curve

Damage of orange crop will decrease its supply & hence derived supply of its by product orange juice.

Since the decrease in supply is due to other (seasonal) factor, it will shift the supply curve - decrease it & leftward shift. This supply deficiency leads to excess demand raising the equilibrium prices finally.