In problem 4, suppose a new snack food comes onto the market and as a result the demand for potato chips decreases by 40 million bags per week.

a. Has there been a shift in or a movement along the supply curve of chips?

b. Has there been a shift in or a movement along the demand curve for chips?

c. What is the new equilibrium price and quantity of chips?

Data from Problem 4

The demand and supply schedules for potato chips are in the table.

What are the equilibrium price and equilibrium quantity of potato chips?

If chips were 60 cents a bag, describe the situation in the market for potato chips and explain what would happen to the price of a bag of chips.