Question

Apparently there is a lemon shortage in Australia. It has caused the price of lemons to increase 300%. Right now they are more expensive than mangoes, pineapples, chicken fillets and beef burgers. Bad weather contributed to a smaller supply of lemons and the had to import more lemons than normal. A lemon normally costs about $4 per kilogram but right now they are ranging about $13 per kilogram. the heat wave last year killed the crop. because Australia is geographically isolated, when there are issues with crops, the prices will spike.

This illustrates an instance that would shift the supply curve. Weather could affect the supply curve and shift the supply curve to the left or right. In this particular case, the shift was to the left.

What are the supply shifters? What can cause the supply curve to shift to the left or the right?

Give examples.

Answer 1