8. Short-run and long-run effects of a shift in demand Suppose that the perfectly competitive chicken industry is in long-run equilibrium at a price of $3 per kilogram of chicken and a quantity of 600 million kilograms per year. Suppose Health Canada issues a report saying that eating chicken is bad for your health. Health Canada's report will cause consumers to demand less producing less chicken and running at a loss Shift the supply curve, the demand curve, or both on the following diagram to illustrate these short-run effects of Health Canada's announcement. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per kilogram) CO 10 ♡ 19 0 0 200 Supply 400 600 800 QUANTITY (Millions of kilograms) Demand 1000 chicken at every price. In the short run, firms will respond by 1200 Demand Supply (?)

8. Short-run and long-run effects of a shift in demand Suppose that the perfectly competitive chicken industry is in long-run equilibrium at a price of $3 per kilogram of chicken and a quantity of 600 million kilograms per year. Suppose Health Canada issues a report saying that eating chicken is bad for your health. Health Canada's report will cause consumers to demand less producing less chicken and running at a loss Shift the supply curve, the demand curve, or both on the following diagram to illustrate these short-run effects of Health Canada's announcement. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per kilogram) CO 10 ♡ 19 0 0 200 Supply 400 600 800 QUANTITY (Millions of kilograms) Demand 1000 chicken at every price. In the short run, firms will respond by 1200 Demand Supply (?)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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8. Short-run and long-run effects of a shift in demand
Suppose that the perfectly competitive chicken industry is in long-run equilibrium at a price of $3 per kilogram of chicken and a quantity of 600 million
kilograms per year. Suppose Health Canada issues a report saying that eating chicken is bad for your health.
Health Canada's report will cause consumers to demand less chicken at every price. In the short run, firms will respond by
producing less chicken and running at a loss
Shift the supply curve, the demand curve, or both on the following diagram to illustrate these short-run effects of Health Canada's announcement.
Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back
to its original position, just drag it a little farther.
PRICE (Dollars per kilogram)
6
0
0
200
Supply
400
600
800
QUANTITY (Millions of kilograms)
Demand
1000
1200
Demand
Supply
(?

In the long run, some firms will respond by
Shift the supply curve, the demand curve, or both on the following diagram to illustrate both the short-run effects of Health Canada's announcement
and the new long-run equilibrium after firms and consumers finish adjusting to Health Canada's announcement.
X
Demand
PRICE (Dollars per kilogram)
0
200
Supply
400
600
800
QUANTITY (Millions of kilograms)
1000
1200
Demand
Supply
until
(?)
Assuming the long-run price and quantity are as you found in the preceding problem, the chicken industry is

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