The figure given below represents the equilibrium price and output in the market for restaurant meals and delivery meals. Figure 4.1
- Refer to Figure 4.1.Identify the impact on the price of Restaurant Meals and Delivery Meals following the direction of the shifts in demand in these two industries.
A)The price of Restaurant Meals rises while the price of Delivery Meals declines.
B)The price of both Restaurant Meals and Delivery Meals declines.
C)The price of Restaurant Meals declines while the price of Delivery Meals rises.
D)The price of both Restaurant Meals and Delivery Meals rises.
E)The price of Restaurant Meals and the price of Delivery Meals add up to $10.

Question

The figure given below represents the equilibrium price and output in the market for restaurant meals and delivery meals. Figure 4.1 
- Refer to Figure 4.1.Identify the impact on the price of Restaurant Meals and Delivery Meals following the direction of the shifts in demand in these two industries.
A)The price of Restaurant Meals rises while the price of Delivery Meals declines. 
B)The price of both Restaurant Meals and Delivery Meals declines. 
C)The price of Restaurant Meals declines while the price of Delivery Meals rises. 
D)The price of both Restaurant Meals and Delivery Meals rises. 
E)The price of Restaurant Meals and the price of Delivery Meals add up to $10.

Quizplus · Accepted Answer

The demand curve for Restaurant Meals has shifted to the left, indicating a decrease in demand. This leads to a decrease in equilibrium price and output for Restaurant Meals. On the other hand, the demand curve for Delivery Meals has shifted to the right, indicating an increase in demand. This leads to an increase in equilibrium price and output for Delivery Meals. Therefore, the price of Restaurant Meals declines while the price of Delivery Meals rises.

The Figure Given Below Represents the Equilibrium Price and Output