Figure 12-16

-Refer to Figure 12-16.Which panel best represents the perfectly competitive organic produce market in which some firms are experiencing short-run losses, and consumers are displaying an increased preference for organic produce?

Question

Figure 12-16
 
-Refer to Figure 12-16.Which panel best represents the perfectly competitive organic produce market in which some firms are experiencing short-run losses, and consumers are displaying an increased preference for organic produce?

Quizplus · Accepted Answer

Panel D shows a decrease in supply (shift to the left) due to firms experiencing short-run losses. There is also an increase in demand (shift to the right) due to consumers displaying an increased preference for organic produce. These changes result in a higher price and a lower quantity, which is indicative of a perfectly competitive market in the short run.

Figure 12-16 -Refer to Figure 12-16.Which Panel Best Represents the Perfectly Competitive