Suppose that the chicken industry is in long-run equilibrium at a price of $5 per pound of chicken and a quantity of 250 million pounds per year.Suppose that WebMD claims that a protein found in chicken will increase your expected lifespan by 5 years.WebMD's claim will cause consumers to demandchicken at every price. In the short run, firms will respond byShift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim.9SupplyDemand8.SupplyDemand10 50100150200250300350400450500QUANTITY (Millions of pounds)103.2.PRICE (Dollars per pound) In the long run, some firms will respond byuntilShift the demand curve, the supply curve, or both on the following graph to illustrate both the short-run effects of WebMD's claim and the new long-run equilibrium after firms and consumers finish adjusting to the news.10SupplyDemand8.7SupplyDemand150100150200250300350400450500QUANTITY (Millions of pounds)in the longThe new equilibrium price and quantity suggest that the shape of the long-run supply curve in this industry isrun.PRICE (Dollars per pound)

Suppose that the chicken industry is in long-run equilibrium at a price of $5 per pound of chicken and a quantity of 250 million pounds per year. Suppose that WebMD claims that a protein found in chicken will increase your expected lifespan by 5 years. WebMD's claim will cause consumers to demand chicken at every price. In the short run, firms will respond by Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim. 10 9. Supply Demand 8 7 Supply Demand 50 100 150 200 250 300 350 400 450 500 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

Suppose that the chicken industry is in long-run equilibrium at a price of $5 per pound of chicken and a quantity of 250 million pounds per year. Suppose that WebMD claims that a protein found in chicken will increase your expected lifespan by 5 years. WebMD's claim will cause consumers to demand chicken at every price. In the short run, firms will respond by Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim. 10 9. Supply Demand 8 7 Supply Demand 50 100 150 200 250 300 350 400 450 500 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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