Demand and Supply
2. Consider the market for potato chips that is competitive with many
small producers. Use the 4-step process of analysing market shocks
(Also known as comparative statics) to outline the change in market
conditions in the following two scenarios (Note each scenario is
independent).
a) There is a reduction in consumer income. (3 marks)
b) The wages of employees in this industry increase. (3 Marks)