(Solved): Short-run and long-run effects of a shift in demand Suppose that the phirodite industry is initially ...

Short-run and long-run effects of a shift in demand Suppose that the phirodite industry is initially operating in long-run equilibrium at a price level of

per pound of phirodite and quantity of 288 million pounds per year. Suppose a leading foodie video blogger raises awareness for a scholarly article that links phirodite consumption to premature hair loss and unhealthy skin. The viral video is expected to cause consumers to demand

phirodite at every price. In the short run, firms will respond by Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the viral video.In the long run, some firms will respond by

until

Shift the demand curve, the supply curve, or both on the following graph to illustrate both the short-run effects of the viral video and the new longrun equilibrium after firms and consumers finish adjusting to the news. The new equilibrium price and quantity suggest that the shape of the long-run supply curve in this industry is

in the long run.