Over the past decade, cruise ship companies have dramatically increased the number of megaships (Those that carry 3,000 passengers or more)., increasing the supply of cruises. At the same time, popularity of cruising has increased among consumers, increasing demand. Explain with graphs how increasing the number of megaships leads to increasing the quantity of cruises. Explain with graphs how the popularity of cruising affects the demand curve. Explain how the effects in (i) and (ii) combined can coincide with decrease in the average price of cruise travel. Demand and supply schedules for potato chips are: Price (cents per bag) Quantity demanded per week Quantity supplied per week 50 160 130 60 150 140 70 140 150 80 130 160 90 120 170 100 110 180 Graph both the supply (S) and demand (D) curves. What is the equilibrium price and quantity? If the price is 60 cents a bag, is there a shortage or a surplus? No, because at 60 cents, the demand has already begun to decrease. How does the price adjust? The price levels for a short period during week 4 at 80 cents. However, the price continues to increase, and the demand continues to decrease. In “What The Rise And Fall Of Lumber Prices Tell Us About The Pandemic Economy” Scott Horsely (NPR) writes: “It's been a roller-coaster ride for lumber prices over the last year – and it's drawn outsize attention from the aisles of Home Depot to the Federal Reserve. Lumber prices surged to record highs this year on the back of booming demand from homebuilders and do-it-yourselfers with plenty of time on their hands […] But over the past two months, lumber prices have been dropping equally fast, giving weight to the central bank's argument that pandemic price spikes for many products are likely to be temporary.” How do you explain the rise and fall of lumber prices during this pandemic period? Explain using a graph.