The market for milk is initially in equilibrium.Milk producers successfully advertise to encourage milk drinking.At the same time,more milk producers enter the market.Standard demand and supply analysis tells us that the:

Question

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With the successful advertisement, the demand for milk will increase and the equilibrium quantity will rise. However, with more milk producers entering the market, the supply will also increase which may result in a price decrease or no change at all. Therefore, we cannot determine how the equilibrium price will be affected.

The Market for Milk Is Initially in Equilibrium