Question

The United States does not allow oranges from Brazil (the world's largest producer of oranges) to enter the United States. If Brazilian oranges were sold in the United States, oranges and orange juice would be cheaper.

Use the laws of demand and supply to explain whether the above statement is true or false.
In your explanation, distinguish between a change in demand and a change in the quantity demanded and between a change in supply and a change in the quantity supplied.

1. The statement is _.
2. Allowing Brazil to enter the U.S. market for oranges would _, which would _ the price and _.
3. Oranges are _ orange juice so the _ would _, which would _ its price and _.

Answer 1

The statement is True

If Brazilian oranges entered the United States, the number of oranges in the market would be higher, and if the quantity demanded remained more or less stable, the oranges prices would fall.

Changes in supply are those produced by anything other than price, thus, in this example we can see a change in supply, because the higher number of oranges has come from the market entry of new competitors : the brazilian orange providers.