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). 

JZ
Answered by Julia Z. Economics tutor

12090 Views

See similar Economics IB tutors

Related Economics IB answers

All answers ▸

If monopolies are so inefficient, why do they still exist?


1. What is a floating exchange rate system and what factors influence the level of a country’s exchange rate?


Evaluate the impact of a price ceiling


Explain the meaning of the law of demand; distinguish between movements along and shifts of the demand curve.


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2025

Terms & Conditions|Privacy Policy
Cookie Preferences