00:01
So here we have a question analyzing the market for beef.
00:03
And i wanted to answer this question, one, just to complain about your instructor, right? because there are multiple things going on here, and we just are not given enough information to come out with a clear answer.
00:14
If the price of beef increases, what would economists expect to happen in the market for beef? okay, this is not a good answer because already two things can increase the price of beef, right? we could increase the price of beef by shifting the supply curve up.
00:30
Right? so one, the supply curve goes up, right? up and to the left.
00:36
In which case we have a movement along the demand curve, right? we have a movement along the demand curve, right? the supply conditions change and consumers simply react to the supply conditions changing, reflected in the changing price in the marketplace.
00:53
The second possibility that could increase the price of beef is that we have an increase in demand, right? you could have a increase in demand, right? demand shift out.
01:04
Demand could shift out and we could move up and along the supply curve as the production side of the beef market responds to the sudden demand for beef.
01:17
So both of these things are possible, right? you could have a shift to the right of the demand curve explaining the increase in the rise of beef, but you could also have an increase in the supply curve, right? the the key thing to answering this question here is that the key is it seems like assume price already happened, right? like the way that we're talking, it sounds like that the price of beef has already gone up.
01:49
And we're looking at it from the demand side after the price of beef has already gone up...