Question

Just need question 5 to 10

What will happen in the domestic market to the equilibrium market price and equilibrium market quantity of strawberries in eachyof the following situations? (+increase; decrease; 0 = no change; ?-indeterminate). Assume that all goods mentioned are normal goods. Price Quantity The economy experiences a recession; the government introduces a subsidy for strawberryfarmers. 1. 1. + - A strawberry jam manufacturer, who produces only for export, opens a plant in the area; raspberries, a production substitute for strawberries, experience increased popularity 3. There is an influx of migrant strawberry-pickers, which forces down the hourly wage they receive; health-conscious consumers decide that strawberries are good for them. 2 An insecticide spray, used on strawberries, is shown to cause colon cancer; new hybrid strawberries are less expensive to produce and provide higher yields. 5. The cost of harvesting strawberries increases; consumers expect their incomes to decrease. 6. t The harvest of strawberries is unusually good this year; there is an increase in tennis playing, which traditionally is accompanied by consumption of strawberries and cream. A stock market crash caused consumers' income to decrease new methods of packing and storage reduce spoilage of strawberries in transit to the market. 7.-- Fertilizer, used in strawberry production, decreases in price; consumers expect an imminent decrease in the price of strawberries. 9. Eating strawberries is shown to be healthy; loganberries, a production substitute of strawberries, increase in price. 10. New hybrid strawberries varieties, that are more resistant to drought, are developed; raspberries, a consumption substitute for strawberries, becomes cheaper

Answer 1

	Price	Quantity	Reason
5	+	-	As cost increases, price increases and income decreases which reduces quantity demanded
6	-	+	Supply increases which decreases price and hence quantity demanded increases
7	-	-	Supply increases which decreases price and decrease in income causes demand to increases
8	-	-	As cost of production decreases, supply increases which decreases price and with expected decrease in price the quantity demanded decreases
9	+	+	As demand increases price too increases and with the increase in price of substitute, the quantity demanded too increases
10	-	-	Supply increases which decreases price and with substitute decrease in price, the demand too decreases