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Gnom [1K]
2 years ago
13

One autumn, the weather is perfect for growing pumpkins, and the pumpkin crop is much larger than usual. Meanwhile, when hallowe

en approaches, jack-o'-lanterns turn out to be less popular than in prior years. Instead, consumers spend more on costumes. What will happen to the price of pumpkins around halloween, compared with last year?
Business
1 answer:
valentina_108 [34]2 years ago
5 0

Answer: Price of pumpkins will fall compared to last year.

Explanation: Favorable weather leading to a larger crop than usual means that there is more supply of pumpkins this year than before.  Shifting the supply curve down to the right. At the same time, when people switch away from jack-o'-lanterns towards buying more costumes, it leads to a decline in the demand for pumpkins shifting the demand curve to the left.

The net result will be a decline in the demand for fall in the price of pumpkin. However, the effect on the quantity cannot be determined as it depends on the magnitude of shift in the two curves.

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