contestada

You love peanut butter. You hear on the news that 50 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to double by the end of the year. As a result, a.your demand for peanut butter will increase, but not until the end of the year. b.your demand for peanut butter increases today. c.your demand for peanut butter decreases as you look for a substitute good. d.your demand for peanut butter shifts left today

Respuesta :

I think your answer is “B.”

If i’m correct MARK ME BRAINLIEST PLEASE!!

bcrinitiative

Answer:

The answer is: b

Explanation:

Peanut butter could be classified as a necessity good depending on individual income and preferences. Your love for peanut butter indicates that you derive utility or satisfaction from consuming this good. When the price of peanuts doubles, the cost of peanut butter will also rise but the extent of the increase is ambiguous. Utility is a factor used in deriving demand, the higher the utility the higher the demand. Given that individuals have budget constraints that limit their consumption ability, a predicted rise in prices in peanut butter will increase the demand for peanut butter today as individuals attempt to maximise their utility by capitalising on the cheaper prices.

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