The supply and demand curves for a new widget are shown in the graph. Notice there are two demand curves. The original demand curve is d1. Months after the product was introduced, there was a possible health concern over use of the product, and demand dropped to the new demand curve, d2. The movement of the demand curve is called a shift.
a. What was the equilibrium price before the demand shift?
b. What was the equilibrium quantity before the demand shift?
c. What was the equilibrium price after the demand shift?
d. What was the equilibrium quantity
e. Express algebraically the difference in quantity demanded at price b before and after the shift.
f. Copy a rough sketch of the graph into your notebook. Label the curves. Where would the demand curve have shifted if a health benefit of the new widget was reported?

Transcribed Image Text:

9 Supply d2