7. Short-run and long-run effects of a shift in demand Suppose that the turkey industry is in long-run equilibrium at a price of $5 per pound of turkey and a quantity of 300 million pounds per year. Suppose hat the Centers for Disease Control (CDC) announces that a chemical found in turkey is causing bacterial infections to spread around the world. The CDC's announcement will cause consumers to demand turkey 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 CDC's announcement. 10 Supply Demand 7 Supply 4 Demand 60 120 180 240 300 360 420 480 540 600 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

7. Short-run and long-run effects of a shift in demand Suppose that the turkey industry is in long-run equilibrium at a price of $5 per pound of turkey and a quantity of 300 million pounds per year. Suppose hat the Centers for Disease Control (CDC) announces that a chemical found in turkey is causing bacterial infections to spread around the world. The CDC's announcement will cause consumers to demand turkey 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 CDC's announcement. 10 Supply Demand 7 Supply 4 Demand 60 120 180 240 300 360 420 480 540 600 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 3PA: Suppose the price elasticity of demand for heating oil is 02. in the short run and 0.7 in the long...

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