Question

As a result of the increase in the demand for tomatoes, we would predict that in the short run that theA. production of tomatoes would be at efficient scale. B. total cost for existing irradiated tomato producers must rise. C. number of firms in the market would fall as prices fall and firms exit the market. D. price of tomatoes would rise.

Answer 1

D is the correct option. The Price of tomato would rises

Step-by-step explanation:

In case of short run, the increase/decrease in demand and supply of the product will affect the price of it. While in long run, it affects other factors than prices. In short run, the increase in demand of tomatoes will increase the price of tomatoes and decrease in demand will decrease the price of it. There is positive relationship between the demand and price of the product. In long run, the increase in demand for tomatoes will affect other factors such as elimination of firm from the market etc. The increase in price of tomato will affect taste and preference of consumers, their income etc.

Thus, the increase in demand of tomatoes will rise the price of it.