Phone Than Sin Thwin Economics

Demand and Supply

(a) A rise in the price of non-diary price.

- Both equilibrium price and quantity of butter rises.
- The demand has shifted right.

(b) A rise in the demand for cream.

- Both equilibrium price and quantity of butter is lowered.
- The demand has shifted left.

(c) A rise in the price of bread.

- Both equilibrium price and quantity of butter is lowered.
- The demand has shifted left.

(d) A rise in the demand for bread.

- Both equilibrium price and quantity of butter rises.
- The demand has shifted right.

(e) An expected rise in the in the price of butter in the near future.
- Both equilibrium price and quantity of butter rises.
- The demand has shifted right.

(f) A tax on butter production.

- Both equilibrium price and quantity of butter is lowered.
- The supply has shifted left.
Phone Than Sin Thwin Economics

(g) The invention of a new, but expensive, process for removing all saturated fat from butter,
alongside the passing of a law which states that all butter producers must use this process.
- The equilibrium price rises and the quantity of butter is lowered.
- The supply has shifted left.