Explain how a change in one of the determinants of supply could lead to a decrease in the price of rice.

Supply is the quantity of a certain product that a producer is willing and able to supply into a market at a given price, in a given time period. Consider the market for rice: an abnormally fruitful harvest would mean that the supply curve in the rice industry for the given year would shift to the right. Assuming that the demand curve for rice remains the same, the increase in supply will lead to a rightward shift of the market equilibrium (i.e. the equilibrium price will fall and the equilibrium quantity will increase). 

Answered by Julia Z. Economics tutor

11086 Views

See similar Economics IB tutors

Related Economics IB answers

All answers ▸

What is the difference between demand and aggregate demand?


Using a price ceiling diagram, analyse the impact a maximum price might have on the market for food.


What are the distinctive characteristics of a perfectly competitive market?


What is the difference between GDP and GNI and how should I compare them?


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2024

Terms & Conditions|Privacy Policy
Cookie Preferences