How Markets Allocate Resources How Do Related Markets

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How Markets Allocate Resources How Do Related Markets React?

How Markets Allocate Resources How Do Related Markets React?

Potatoes �A new fertilizer is developed that will increase the harvest of potatoes. �

Potatoes �A new fertilizer is developed that will increase the harvest of potatoes. � Is this a demand or supply issue for potatoes? � How will it impact supply? � How will this impact the price of potatoes?

Bread � If the supply of potatoes increases and the price of them goes

Bread � If the supply of potatoes increases and the price of them goes down, how does this impact the supply or demand of bread? � If the demand for bread decreases, how does this impact the demand for wheat? � If the demand for wheat goes down, how does this impact the demand for wheat harvesting machinery?

Impact of Fertilizer on Markets Potatoes Bread Wheat Harvesting Machines Demand Neutral Decrease Supply

Impact of Fertilizer on Markets Potatoes Bread Wheat Harvesting Machines Demand Neutral Decrease Supply Increase Neutral Equil. Price Decrease Equil. Quantity Increase Decrease

Leather Products � Increased preference in briefcases and luggage made from leather. � Is

Leather Products � Increased preference in briefcases and luggage made from leather. � Is this a supply or demand issue for leather? � How does it impact demand? � How does it impact the price of leather?

Leather Shoes � If the cost of leather goes up, how would this impact

Leather Shoes � If the cost of leather goes up, how would this impact leather shoes? Is this a demand or supply issue? � How does it impact supply and what happens to the price of leather shoes? � If the price of leather shoes goes up, what will happen to the demand for leather shoes, and correspondingly the demand for leather shoelaces? � Finally, how will this impact the demand for shoelace packaging machines?

Impact of Preference for Leather Shoes Shoelaces for Leather Shoes Shoelace Packaging machines Demand

Impact of Preference for Leather Shoes Shoelaces for Leather Shoes Shoelace Packaging machines Demand Increase Neutral Decrease Supply Neutral Decrease Neutral Equil. Price Increase Decrease Equil. Quantity Increase Decrease

Coffee and Tea �A heavy frost destroys half of the world’s crop of coffee

Coffee and Tea �A heavy frost destroys half of the world’s crop of coffee beans. � People in tea. � What use more cream in coffee than they do are the resultant changes in the supply and demand for coffee, tea, cream and automatic coffee makers?

Impact of Frost Coffee Tea Cream Automatic Coffee Makers Demand Neutral Increase Decrease Supply

Impact of Frost Coffee Tea Cream Automatic Coffee Makers Demand Neutral Increase Decrease Supply Decrease Neutral Equil. Price Increase Decrease Equil. Quantity Decrease Increase Decrease