The following schedules are for bushels of apples in a local...

The following schedules are for bushels of apples in a local market. Graph the supply and demand curves. What are the equilibrium price and quantity? $$ \begin{array}{ccc} \hline \text { Price } & \begin{array}{c} \text { Quantity } \\ \text { Demanded } \end{array} & \begin{array}{c} \text { Quantity } \\ \text { Supplied } \end{array} \\ \hline \$ 20 & 200 & 1,000 \\ 18 & 400 & 800 \\ 16 & 600 & 600 \\ 14 & 800 & \$ 00 \\ 12 & 1,000 & 200 \\ \hline \end{array} $$ Now assume that an early freeze has decreased the apple harvest, and the new supply schedule is as follows. Has supply increased or decreased? What are the new equilibrium price and quantity? (Note that the demand curve is unchanged.) $$ \begin{array}{cc} \hline \text { Price } & \text { Quantity Supplied } \\ \hline \$ 20 & 600 \\ 18 & 400 \\ 16 & 200 \\ 14 & 0 \\ \hline \end{array} $$

The following schedules are for bushels of apples in a local market. Graph the supply and demand curves. What are the equilibrium price and quantity?
$$
\begin{array}{ccc}
\hline \text { Price } & \begin{array}{c}
\text { Quantity } \\
\text { Demanded }
\end{array} & \begin{array}{c}
\text { Quantity } \\
\text { Supplied }
\end{array} \\
\hline \$ 20 & 200 & 1,000 \\
18 & 400 & 800 \\
16 & 600 & 600 \\
14 & 800 & \$ 00 \\
12 & 1,000 & 200 \\
\hline
\end{array}
$$
Now assume that an early freeze has decreased the apple harvest, and the new supply schedule is as follows. Has supply increased or decreased? What are the new equilibrium price and quantity? (Note that the demand curve is unchanged.)
$$
\begin{array}{cc}
\hline \text { Price } & \text { Quantity Supplied } \\
\hline \$ 20 & 600 \\
18 & 400 \\
16 & 200 \\
14 & 0 \\
\hline
\end{array}
$$

Key Concepts

Shifts in the Supply Curve

A shift in the supply curve occurs when factors other than the price of the good influence the quantity supplied at every price level. For example, external events that affect production, changes in production costs, or improvements in technology can shift the supply curve to the left (a decrease in supply) or to the right (an increase in supply). Understanding shifts in the supply curve is essential for predicting how external shocks will affect market equilibrium, particularly the equilibrium price and quantity.

Market Equilibrium

Market equilibrium is achieved when the quantity supplied equals the quantity demanded, resulting in a stable market condition where there is no inherent tendency for the price or quantity to change. This equilibrium point is determined by the intersection of the supply and demand curves and is crucial in understanding how markets allocate resources efficiently.

Demand Curve

The demand curve shows the relationship between the price of a good and the quantity demanded by consumers. It typically slopes downward, indicating that as the price decreases, consumers are willing to purchase more of the good. This concept helps in understanding consumer behavior and predicting changes in market demand under various circumstances.

Supply Curve

The supply curve represents the relationship between the price of a good and the quantity that producers are willing to supply. Generally, it slopes upward, meaning that higher prices encourage producers to supply more of the good. This concept is fundamental in analyzing how changes in market conditions, such as technological advancements or input costs, affect production decisions.

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