Question

Supply and Demand v Given what you have learned about 1) demand (and its determinants) and quantity demanded and 2) supply (and its determinants) and quantity supplied work with your group members to analyze this hypothetical situation: There is a shortage of eggs. Consumers are substituting what they perceive to be "healthy" sandwich spreads for traditional mayonnaise. As a result, the makers of mayonnaise are introducing new sandwich spreads into the market The price of traditional mayonnaise is falling. Why? To help you figure this out, draw a supply/demand graph for mayonnaise for yourself (not to submit to me); then compare your graph with those of your group members. If it's easy for you to scan your graph and attach it to your post, do that. But if it's not easy to do that, just describe your graph in words. That is, explain how you labeled the axes of your graph, what the demand curve looks like, what the supply curve looks like, how you labeled the equilibrium price and quantity, any curve shifts, and what happened to equilibrium price and quantity as a result of the curve shift(s) (changes in demand and/or supply). [You will have to be able to explain how to draw a supply/demand graph on the first exam.]

Answer 1

if there is a shortage of eggs, as mayonnaise are made of eggs there is this perception of people that eggs are being replaced by something else which is not something the consumers want. so people started to substitute mayonies with something healthier. as a result the demand for traditional mayonies decreases which result in decreased price of mayonies. this happens because as we have read in our lessions from demand as demand increases price increases and vice versa.

in this case the demand curve for mayonies shifts backword because of change of other factors rather than price say availability of eggs. as we know when price of a product changes there is movement along the demand curve ad its called change in quantity demand of the product but as there is change in othere factors rather than price, demand curve shifts and is called change in demand. and this change in demand causes price of the product to change.

a, jram Coniwe