Hashtags such as “toiletpaperapocalypse”, “toiletpapergate”, etc were trending on Twitter in Australia in early March 2020. Such trends occurred as a significant number of Australians rushed to panic-buying toilet papers amid fears of the coronavirus outbreak. When asked, many shoppers said they wanted to stockpile in case the virus was to spread across the community. a. Draw appropriate supply & demand graph(s) to illustrate the effects of the above shock on the market for toilet papers in Australia. In your own words, explain which curve(s) would shift and the reason behind the shift. b. Comment clearly on the changes in price and quantity of toilet papers in Australia following the shock above. c. Supermarkets have vowed not to increase the price of toilet papers. At the same time, they have moved to limit purchases to 4 packs per customer. What would happen to the market of toilet papers following the above policies by supermarkets? Suppose now toilet papers could be imported into Australia in unlimited quantities at a low cost. How would this change the situation? Draw appropriate graph(s) to illustrate your answer.
Hashtags such as “toiletpaperapocalypse”, “toiletpapergate”, etc were trending on Twitter in Australia in early March 2020. Such trends occurred as a significant number of Australians rushed to panic-buying toilet papers amid fears of the coronavirus outbreak. When asked, many shoppers said they wanted to stockpile in case the virus was to spread across the community. a. Draw appropriate supply &
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