Demand and supply of a product change considerably depending on various market factors, like price and customer preferences. When the doctor encourages people to take apples to lower cancer risk, many people will change their fruit preferences and opt to take more apples, considering the increased cases of cancer around the globe. This shift causes a rise in demand and price at first, but lower prices and saturated supply in the long run, for apple and related products.
First, there will be an increase in the demand for apples as people seek to include them in their diets to reduce their cancer risk. This will lead to higher apple prices as suppliers respond to the increased demand by raising prices. Second, there will be an increase in the supply of apples as growers respond to the higher prices by planting more apple trees and harvesting more apples. This increased supply will eventually lead to lower prices for apples as the market becomes saturated with apples, and suppliers are forced to lower costs to attract buyers (Turvey, 2022). Third, there will be an increase in the demand for apple products as people seek to include apples in their diets in various forms, such as applesauce, apple pie, and apple-flavored drinks. This will lead to higher prices for apple products as suppliers respond to the increased demand by raising prices.
Lastly, there will be an increase in the supply of apple products as manufacturers respond to the higher prices by increasing production. This increased supply will eventually lead to lower prices for apple products as the market becomes saturated with apple products, and suppliers are forced to lower costs to attract buyers (Turvey, 2022). In conclusion, the surgeon general’s decision to declare that ‘eating more apples will reduce the danger of cancer’ will significantly impact the market for apples and apple products, resulting in higher prices in the short run and lower prices in the long run.
Demand first rises, Prices go up (Short Run)
Demand Curve
Supply Rises, Prices go down (Long run)
Supply Curve
Reference
Turvey, R. (2022). Equilibrium, prices, demand, and supply. Demand and Supply, 74–91.