Assume the marketplace for milk. for each of the following, Ask an Expert

Economics

Effects of supply and demand shocks on the market for milk

Consider the market for milk. For each of the following events, state (a) whether it affects supply or demand (or both, or neither), (b) which direction supply/demand shifts, (c) the effect on price, and (d) the effect on quantity.

1. Consumer income rises, and milk is a normal good.
2. The cost of feed for dairy cows increases.
3. The price of cereal, a complement, rises.
4. Wages paid to dairy farm workers increase.
5. Technology used to produce milk becomes more efficient.

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M9212289

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