8. Short-run and long-run effects of a shift in demandSuppose that the seitan industry is initially operating in long-run equilibrium at a price level of $5 per pound of seitan and quantity of 50million pounds per year. Suppose that the Food and Drug Administration (FDA) reports that compounds naturally occurring in seitan arelinked to chronic illness.The FDA's research is expected to cause consumers to demand seitan at every price. In the short run, firms will respondbyShift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the FDA's research.PRICE (Dollars per pod01020SupplyIn the long run, some firms will respondbyDemandTOQUANTITY (Mons of pounds)20 100DemandSupplyuntilShift the demand curve, the supply curve, or both on the following graph to illustrate both the short-run effects of the FDA's researchand the new long-run equilibrium after firms and consumers finish adjusting to the news. In the long run, some firms will respondbyShift the demand curve, the supply curve, or both on the following graph to illustrate both the short-run effects of the FDA's researchand the new long-run equilibrium after firms and consumers finish adjusting to the news.PRICE (Dollars per pod10a20SupplyDemand2050 80 TOQUANTITY (Millions of pounds)80until20 100DemandSupplyThe new equilibrium price and quantity suggest that the shape of the long-run supply curve in this industry isthe long run.

Short-run is a period when some elements of production is fixed and some are variable. Output can be…

Short-run and long-run effects of a shift in demand uppose that the seitan industry is initially operating in long-run equilibrium at a price level of $5 per pound of seitan and quantity of 50 million pounds per year. Suppose that the Food and Drug Administration (FDA) reports that compounds naturally occurring in seitan are nked to chronic illness. the FDA's research is expected to cause consumers to demand seitan at every price. In the short run, firms will respond У hift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the FDA's research. PRICE (Dollars per pod 1 0 a 20 the long run, some firms will respond У Supply 80 ТО QUANTITY (Mons of pounds) hift the demand sunce the supply un Demand 100 Demand Supply until bath on the following aranh bn illustrate both the chartmunffate of the FDA

Short-run and long-run effects of a shift in demand uppose that the seitan industry is initially operating in long-run equilibrium at a price level of $5 per pound of seitan and quantity of 50 million pounds per year. Suppose that the Food and Drug Administration (FDA) reports that compounds naturally occurring in seitan are nked to chronic illness. the FDA's research is expected to cause consumers to demand seitan at every price. In the short run, firms will respond У hift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the FDA's research. PRICE (Dollars per pod 1 0 a 20 the long run, some firms will respond У Supply 80 ТО QUANTITY (Mons of pounds) hift the demand sunce the supply un Demand 100 Demand Supply until bath on the following aranh bn illustrate both the chartmunffate of the FDA

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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