What will happen to newspapers as the demand for words printed on precious tree pulp decreases?
Use the four step process pasted here for your convenience.
1 point
1
Question 2
2.
What will happen to price and quantity of newspapers?
1 point
1
Question 3
3.
Now, here's the "A" level problem solving for which you should prepare.
As baby boomer employees of the United States Postal Service start to retire and pension payments increase, the cost of running the post office is increasing. At the same time, when's the last time you sent something via snail mail? In other words, demand for this service is on the decline.
There are two shifts occuring here; one for supply and demand.
For now, draw a supply and demand curve with black lines, labeled S0 and D0. Based on the information above, draw the correct shift in supply with a blue line and label S1. Then, draw the correct shift in demand with a red line and label D1.
Wherever the blue S1 and red D1 intersect is the new equilibrium point.