Question

In the market for breakfast cereal, the market is currently in equilibrium. suddenly there is a storm that destroys the wheat that farmers had been growing for the cereal manufacturer. what will happen to the cereal market after the storm?

Answer 1

The answer is "Supply will decrease."

A storm that crushed the wheat products would make the cost of that grain to rise. Given that grains are a critical contribution to the make of oat, the ascent in the cost of grain speaks to an expansion in input costs for oat. This is spoken to in the grain advertise as a leftward move of the supply bend and no adjustment in the demand curve.