Question

Suppose that the tuna Industry is in long-run equilibrium at a price of $per can of tuna and a quantity of 350 million cans per year. Suppose the Surgeon General Issues report saying that eating tuna is bad for your health.

Suppose that the tuna industry is in long-run equilibrium at a price of $5 per can of tuna and a quantity of 350 million cans per year. Suppose the Surgeon General issues a report saying that eating tuna is bad for your health. The Surgeon General's report will cause consumers to demand tuna 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 the Surgeon General's report. -O Supply Demand - O Supply PRICE (Dollars per can) 0 70 140 560 630 700 210 280 350 420 480 QUANTITY (Millions of cans)

Answer 1

Solution The specialist commanders report will make Consumers request less fish at couch price. in the short sun, firme will react by diminshing stock and sun at a misfortune The interest for fish will fall and the interest bend will move to One side harmony cost amount will fall there will be a movemen along the stock bend, as less will be provided at the scaled down value this is in short-run and nong cost و ه Supply م کد price (colars per can) ه ا / 1 ع ) م - Demand D • 10 20 30 40 50 60 70 80 90 100 Quantity (Minions of cans) in the event that the long run, some firms. will react by leaving the business, untill each firm is acquising ordinary benefits

& Supply 5+-- long Supples a price (dollars run market curre Demand pon Catime); can af or 10 20 10 20 30 40 50 60 70 80 90 100 Quantity (minions of cans in the long run, supply bend movements to one Side lastly the balance value returns to $5 per can The market supply bend is hosszental.