Consider the market for the normal good Corn Flakes. Assume the supply and demand curves have normal (i.e. consistent with the laws of supply and demand) slopes. The market is currently in equilibrium. In each of the following situations indicate what will happen to the price of Corn Flakes and the quantity sold in the market. Each situation described below is a separate situation and should be treated independently. (I.e., Will the price of Corn Flakes increase, decrease, or not change? Will the quantity of Corn Flakes sold in the market increase, decrease, or not change? Diagrams are not necessary in your answer. I am only asking for the final results. That is what happens to price and quantity sold after each of the following events as described occurs.) a. The price of Rice Krispies and Fruit Loops both decrease. Corn Flakes price will ________ and quantity sold will _____________ b. Consumer disposable income increases significantly as a result of an income tax reduction. Corn Flakes price will ___________ and quantity sold will ___________. c. The price of milk increases by seventy percent due to a problem on dairy farms. Assume that everyone who eats Corn Flakes for breakfast adds milk to their bowl of Corn Flakes. Corn Flakes price will _________ and quantity sold will _________. d. Much to the amazement of people in the medical profession the consumption of breakfast cereals like Corn Flakes is determined to be the most likely cause of heart disease to the extent where the Food and Drug Administration orders warning labels to be placed on every box. As you might expect, most people do not want to get heart disease. Corn Flakes price will ________ and quantity sold will _________. e. Corn Flakes is selected to be the breakfast cereal of the US military, the National Football League, the Boy Scouts of America, the NCAA, and food service here at the University. It will now be the only breakfast cereal served to members of these groups in every dining hall where they are likely to have breakfast. Corn Flakes price will ________ and quantity sold will ___________. f. New technological advancements are developed in the manufacture of Corn Flakes. Corn Flakes price will _______ and quantity sold will _________. g. Workers at all Corn Flakes factories, after a successful strike, receive a thirty- percent increase in wages. Corn Flakes price will _______ and quantity sold will _________.
Consider the market for the normal good Corn Flakes. Assume the
a. The price of Rice Krispies and Fruit Loops both decrease. Corn Flakes price will ________ and quantity sold will _____________
b. Consumer disposable income increases significantly as a result of an income tax reduction. Corn Flakes price will ___________ and quantity sold will ___________.
c. The price of milk increases by seventy percent due to a problem on dairy farms. Assume that everyone who eats Corn Flakes for breakfast adds milk to their bowl of Corn Flakes. Corn Flakes price will _________ and quantity sold will _________.
d. Much to the amazement of people in the medical profession the consumption of breakfast cereals like Corn Flakes is determined to be the most likely cause of heart disease to the extent where the Food and Drug Administration orders warning labels to be placed on every box. As you might expect, most people do not want to get heart disease. Corn Flakes price will ________ and quantity sold will _________.
e. Corn Flakes is selected to be the breakfast cereal of the US military, the National Football League, the Boy Scouts of America, the NCAA, and food service here at the University. It will now be the only breakfast cereal served to members of these groups in every dining hall where they are likely to have breakfast. Corn Flakes price will ________ and quantity sold will ___________.
f. New technological advancements are developed in the manufacture of Corn Flakes. Corn Flakes price will _______ and quantity sold will _________.
g. Workers at all Corn Flakes factories, after a successful strike, receive a thirty- percent increase in wages. Corn Flakes price will _______ and quantity sold will _________.
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