Answer to Question #222583 in Microeconomics for sek

Question

indicate and illustrate what happens in the market for hamburgers in each of the following:A.) The price of hot dogs increase.

B.) A disease develops that kills a large proportion of cattle.

C.) Medical research proves that a new breed of cattle result in hamburgers with less cholesterol.

D.) A direct subsidy on each head of cattle is provided to farmers raising cattle.

E.) A new breed of cattle is developed that grows much faster and reproduces at a higher rate

Answer 1

A.

The demand for hamburgers will raise . Consumers will go for more of them because their prices will be cheaper as compared to the price of hot dogs.

B.

The supply of hamburgers will fall and there will be a deficit in the market. Consumers' demand won't be satisfied. Price of hamburgers will increase due to its availability in low quantity.

C.

Demand for hamburgers will increase. Consumers will go for more hamburgers considering its utility.

D.

Supply of hamburgers will increase. This is because the production cost will be cut down.

E.

There will be a surplus in the market. This will result in a fall in price of hamburgers.