• Explain how the following event will affect the demand and supply curves for grape juice

Consumer income falls due to a recession

a. Explain whether the demand curve will (i) move to the left; (ii) move to the right; or (iii) not move. EXPLAIN WHY IT DOES THIS

b. Explain whether the supply curve will (i) move to the left; (ii) move to the right; or (iii) not move. EXPLAIN WHY IT DOES THIS

c. Draw the demand and supply curves before and after the event above.

• You do NOT need to plot the demand curve exactly with actual numbers on the axes
• Make sure your demand and supply curves follow the laws of demand and supply
• Make sure you the curves and axes are appropriately labeled
• Make sure you include arrows indicating movement of curves
• Clearly note the old and new equilibrium prices are quantities are clear.

d. Show how this affects the equilibrium price and quantity. Make sure your demand and supply curves follow the law of demand and supply, the curves and axes are appropriately labeled, arrows indicating movement of curves are shown, and the old and new equilibrium prices are quantities are clear.