Suppose a frost destroys much of the Florida orange crop. At the same time, suppose consumer tastes shift toward orange juice, What would we expect to happen to the equilibrium price and quantity in the market for orange juice ?

Question

Suppose a frost destroys much of the Florida orange crop. At the same time, suppose consumer tastes shift toward orange juice, What would we expect to happen to the equilibrium price and quantity in the market for orange juice ?

Answer 1

A. price will decrease, quantity is ambiguous
B. The impact on both price and quantity is ambiguous.
C. Price will increase, quantity will increase
D. price will increase, quantity will decrease
E. price will increase, quantity is ambiguous.

Correct Answer: price will increase, quantity is ambiguous. ✔

Last Updated: June 18, 2019