substitute good, increases, while all other factors remain constant. Explain the change(s) in theequilibrium price and quantityProblem 4: Show/Draw graph(s) and movement of curve (s) (Demand/Supply) and briefly discuss.Suppose we are analyzing the market for hot chocolate. Graphically using demand and supply linesillustrate the impact each of the following would have on demand or supply. Also, show how equilibriumprice and equilibrium quantity would change and discuss why for each of the following.Winter starts, and the weather turns sharply colder.a.b.The price of tea, a substitute for hot chocolate, falls.The price of cocoa beans decreases.с.2 d.The price of whipped cream falls.A better method of harvesting cocoa beans is introduced.e.f.The Surgeon General of the U.S. announces that hot chocolate cures acne.Protesting farmers dump millions of gallons of milk, causing the price of milkConsumer income falls because of a recession, and hot chocolate is considereda normal good.g.Producers expect the price of hot chocolate to increase next month.h.If the price of hot chocolate is $.50 per cup above equilibrium.i.Problem 5:

Question
Asked Oct 21, 2019

Part f and i

substitute good, increases, while all other factors remain constant. Explain the change(s) in the
equilibrium price and quantity
Problem 4: Show/Draw graph(s) and movement of curve (s) (Demand/Supply) and briefly discuss.
Suppose we are analyzing the market for hot chocolate. Graphically using demand and supply lines
illustrate the impact each of the following would have on demand or supply. Also, show how equilibrium
price and equilibrium quantity would change and discuss why for each of the following.
Winter starts, and the weather turns sharply colder.
a.
b.
The price of tea, a substitute for hot chocolate, falls.
The price of cocoa beans decreases.
с.
2
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substitute good, increases, while all other factors remain constant. Explain the change(s) in the equilibrium price and quantity Problem 4: Show/Draw graph(s) and movement of curve (s) (Demand/Supply) and briefly discuss. Suppose we are analyzing the market for hot chocolate. Graphically using demand and supply lines illustrate the impact each of the following would have on demand or supply. Also, show how equilibrium price and equilibrium quantity would change and discuss why for each of the following. Winter starts, and the weather turns sharply colder. a. b. The price of tea, a substitute for hot chocolate, falls. The price of cocoa beans decreases. с. 2

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d.
The price of whipped cream falls.
A better method of harvesting cocoa beans is introduced.
e.
f.
The Surgeon General of the U.S. announces that hot chocolate cures acne.
Protesting farmers dump millions of gallons of milk, causing the price of milk
Consumer income falls because of a recession, and hot chocolate is considered
a normal good.
g.
Producers expect the price of hot chocolate to increase next month.
h.
If the price of hot chocolate is $.50 per cup above equilibrium.
i.
Problem 5:
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d. The price of whipped cream falls. A better method of harvesting cocoa beans is introduced. e. f. The Surgeon General of the U.S. announces that hot chocolate cures acne. Protesting farmers dump millions of gallons of milk, causing the price of milk Consumer income falls because of a recession, and hot chocolate is considered a normal good. g. Producers expect the price of hot chocolate to increase next month. h. If the price of hot chocolate is $.50 per cup above equilibrium. i. Problem 5:

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Expert Answer

Step 1

(f)

In this part, the U.S. surgeon announces that hot chocolate cure acnes; therefore, knowing this point of view of surgeon individuals who are suffering from acnes starts eating hot chocolate on regular basis. As a result, the demand for hot chocolate will rise keeping its supply constant. That means, demand curve will shift rightwards where as supply curve remains same which leads to rise in both the equilibrium price and quantity of hot chocolate in the market.

Furthermore, there is a line...

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