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QUESTION 1: Based on the title of the article “Avocado prices hit record highs with increased demand and scarce supply”, we can see that demand of avocado has upward trend while the supply...

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QUESTION 1:
Based on the title of the article “Avocado prices hit record highs with increased demand and scarce supply”, we can see that demand of avocado has upward trend while the supply of avocado has a downward trend

QUESTION 2:
Based on the article, the avocado supply can be support by more avocado orchard which is being set up (Lara Wester, XXXXXXXXXXThe supply of avocado is expected to increase significantly over the next few years through marketing campaign (number of seller factor). In addition, the demand for avocados continues to increase as it can be used in the variety of foods (preference factor). Especially, avocado is considered to be unique fruit that no fruit can replace them (number of buyer factor). Therefore, both demand and supply will increase because of these determinants above.

Answered Same DayNov 14, 2019ECON1008

Solution

Student answered on Nov 30 2019
51 Votes
Question 1
Based on the given article about pineapple oversupply, it is apparent that the pineapple growing region in Australia has witnessed an unusually warm climate and hence there has been a early ripening of the pineapple fruit which has caused an oversupply. This is because a part of the production was supposed to be harvested in the spring but has to be harvested early leading to increased supply.
It is given that the pineapple market is perfectly competitive which implies that there is no product differentiation and also the sellers tend to be price takers. As a result, the individual sellers have to sell at the rates which are determined for the industry based on the market demand and supply forces. Considering that the buyers have complete information, hence any seller who tends to exceed the market determined price would not have any sales. It is apparent based on the given article that there has been an increase in the supply of pineapples which would...
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