Question

Washington state had a bumper apple crop this year, significantly increasing the supply of apples in the U.S. Given this information, choose the statement that correctly describes the effect on the U.S. apple market.

Answer 1

A bumper crop of apples in Washington state will likely lead to a higher equilibrium quantity of apples sold at a lower price in the US market, following supply and demand principles similar to those affecting the California commercial salmon market.

Step-by-step explanation:

Given the information that Washington state had a bumper apple crop, which has significantly increased the supply of apples in the U.S., we can predict the impact on the apple market using principles from economics. Similar to the scenario with California commercial salmon, an increase in supply, assuming demand remains constant, typically leads to a higher equilibrium quantity of the good being bought and sold at a lower price.

The principles of supply and demand dictate that as supply goes up, the surplus of apples would drive prices down to balance out the excess supply. Buyers benefit from the decreased prices, while sellers might experience reduced revenues per unit because of the lower prices.

Answer 2

the quantity of apples demanded will increase as the price of apples falls

Step-by-step explanation:

When a supply of a certain product is increased, there amount of that product in the seller's storage tend to become abundant. To make the customers choose to buy the product from them instead of their competitors, most sellers will reduce the price of this product.

Since the price of the product falls, more customers will be able to afford the product with their current disposable income. This is the reason why the quantity of the demand will increase.