Question

question 16
1 pts
in 2007, california experienced its worst freeze since 1999 severely damaging the orange industry. because california is responsible for supplying the majority of oranges to america, what would you expect to happen?

the supply curve for the market for oranges should shift to the right.

the demand curve for the market for apples should shift to the right assuming apples and oranges are considered substitutes.

the demand curve for the market for oranges should shift to the left.

the demand curve for the market for apples should shift to the left assuming apples and oranges are considered substitutes.

Explanation:

1. Analyze the orange supply: The freeze damages California's orange industry, so the supply of oranges decreases. This would shift the orange supply curve left (not right, so first option is wrong).
2. Analyze orange demand: The damage to supply affects supply, not demand directly, so the orange demand curve doesn't shift left (third option is wrong).
3. Analyze substitute goods (apples and oranges): If oranges become scarcer (due to reduced supply), consumers will turn to substitutes like apples. An increase in preference for apples (as a substitute) shifts the apple demand curve right. So the second option is correct, and the fourth (shifting apple demand left) is wrong.

Answer:

B. The demand curve for the market for apples should shift to the right assuming apples and oranges are considered substitutes.