Answer to Question #308736 in Microeconomics for joseph

Question #308736

Consider the market for ice cream . Using appropriate diagrams, explain how each of the following events will impact the equilibrium price and quantity of ice cream.

a. The population falls.


1
Expert's answer
2022-03-10T17:58:54-0500



When the population falls, there is surplus of the ice-cream in the market and the sellers find their freezers increasingly full of ice-cream. They would want to sell but they are unable because of the reduced demand as a result of the reduced in demand due to fall in population. This way the sellers will reduce the prices to respond to surplus.


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