Factors Affecting Demand and Supply for Ice Cream and Potato Chips

Factors affecting demand curve for ice cream and potato chips

1.Identify a good you commonly use or would like to use.  Explain at least three factors that would result in a shift in the demand curve for that good and three factors that would result in a shift in the supply curve for that good.

2. Describe the effect on equilibrium price and quantity of each factor.

3. Finally, explain how the shifts in demand and supply are different from movements along the demand curve or movements along the supply curve and why the distinction is important.  
The above questions are what the class is responding to.   
Assignment:  Read the 2 short responses below. Then reply with 1 substantive response paragraph.  Instructor’s directions: Follow these instructions when writing your response.  Note:  When responding to your peers, praise them for what they are doing well, and lend your own information and/or perspective to your peer's discussion response. (All of your responses within the discussion threads need to be no less than six or seven full sentences in length and pertain to the Discussion Board Question/Topic, in order to be eligible for participation credit).

1.Ice cream is a product that is sought after world-wide. A shift in the demand curve for ice cream has many factors. For example, a shift to the right could be from an increase in income that would allow for an extra expenditure, warmer weather that would be quenched by a cold treat, or just the consumer's expectations of ice cream. A shift in the supply curve for ice cream could be caused by multiple factors. For example, an increase in the cost of milk that is used to make ice cream, how many places sell ice cream, or severe weather conditions will all have an impact.
If the demand curve shifts to the right, it means that there is an increase in the demand for ice cream that comes from other factors outside of price, such as an increase in income, warm weather, or favored expectations by the consumer. To maintain equilibrium, the supply curve should match the new quantity needed based on the new demand and the price should be constant, to keep equilibrium. If the demand curve shifts to the left, meaning that there is a decrease in demand for ice cream based on something other than price, then the opposite should occur.
If there is a shift in the supply of a product, equilibrium must still be attained. If the shift in supply is negative from an increase in the price of the ingredients it takes to make ice cream, fewer places willing to sell the specific type of ice cream, or intense cold weather, the shift on a graph would be to the left. To maintain equilibrium, price and quantity must work in tandem. For example, as supply decreases, the equilibrium price increases while the equilibrium quantity lowers and vice versa (Froeb, McCann, & Ward, 2017, p. 103).
The shifts of demand and supply are different than movements along the demand and supply curve. This is important to know because shifts are not based on price changes, they are based on other external factors and movements of the curve are based on a change in prices. For example, if the price of ice cream decreases, demand would increase, and the supply would essentially decrease.

2.I chose a product that I partake in too often, potato chips. Three factors that would result in a shift in the demand curve are: 1. change in consumers income 2. change in desire, such as interest a substitute product -popcorn or pretzels. 3. ability to purchase product.
Three factors that would result in a shift in the supply curve for that good are 1. price in potatoes-increasing the cost of production, 2. increase in gas prices impacting shipping. 3. castrophic changes beyond suppliers control.
Describe the effect on equilibrium price and quantity of each factor.
1.When there is a change in income and it rises, demands shifts to the right and raise the price and quantity. A decrease in income causes a left shift that causes quantity to decline and the price to drop.
2. If the price of a substitutable items such as popcorn or pretzels declines, demand for chips shift to the left, indicating a decline. The equilibrium quantity will drop and the price will drop also. However, when the price of a substitute item rises, the demand will shift to the right and result in an increase of equilibrium quantity and price. 
3. If I am no longer interested in eating chips and want to eat healthier, I will purchase less, the equilibrium price will decrease and the quantity demanded will decrease also since the demand curve shift to the left. 
4. If the producer of the potato chips can produce the product at a lower price, the supply will increase. However, if the supply increase, the supply curve will shift to the right, causing the equilibrium price to drop and the equilibrium quantity will increase.
5. If gas prices rise and shipping is impacted, supply will decrease, however, if the supply increase, the supply curve will shift to the right.
Finally, explain how the shifts in demand and supply are different from movements along the demand curve or movements along the supply curve and why the distinction is important.
As explained in our textbook, changes in price lead to demand in quantity changes. As little as $1 increase can decrease quantity demand. One fewer consumer decides to purchase due to the increase; quantity demand decreases which is known as movement along the demand curve. Price is not the only thing that affects demand. There are some controllable factors as well as some uncontrollable factor