Your firm produces ready- made guacamole and avocados are the primary ingredient. During a news report, weather forecasters just announced that there will be a freeze in the region in which your firm buys avocados. This freeze will likely damage many of the avocados that are almost ready for harvest.
-Refer to the figure above. As a result of the freeze, the price for avocados will be________ than the current equilibrium price and the equilibrium quantity of avocados will be________than the current equilibrium quantity.

Question

Quizplus · Accepted Answer

A freeze would likely damage the avocado crop, reducing the supply of avocados. This decrease in supply would shift the supply curve to the left, leading to a higher equilibrium price and a lower equilibrium quantity.

Your Firm Produces Ready- Made Guacamole and Avocados Are the Primary