This question provides another chance to practice implementing the 4-step approaching to analyzing shifts in supply and demand. In order to receive full credit on this Problem Set, you must answer this question completely correctly. If your answer to this question is not completely correct, you cannot earn more than half credit on this problem set.

With the onset of the coronavirus pandemic, many people became fearful of going to restaurants for full-service, sit-down meals.

a. Did the fear of eating in restaurants represent an increase in demand for restaurant meals, a decrease in demand for restaurant meals, an increase in supply of restaurant meals, or a decrease in supply of restaurant meals?

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b. Based on your answer to part a, does the fear of eating in restaurants create the shortage of restaurant meals or does it create the surplus of restaurant meals?

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c. Based on your answer to part b., will the equilibrium price of restaurant meals go up or will the equilibrium price of restaurant meals go down?

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d. Based on your answer to part c., will the equilibrium quantity of restaurant meals go up or will the equilibrium quantity of restaurant meals go down? Explain your answer. In particular, will your answer focus on quantity demanded or will it focus on quantity supplied?

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e. Result: state the effects of the fear of eating in restaurants on the equilibrium price and quantity of restaurant meals.

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