If Heavy Concentrations Of Mercury And The Labor Industry Will Shrink

1626 Words Apr 1st, 2015 7 Pages
If heavy concentrations of mercury are found in tuna, the labor industry will shrink. The quantity of workers demanded will outweigh the quantity of workers supplied, leading to a labor shortage until the problem is solved. Customers will be less inclined to eat tuna if they know it contains mercury. Thus, the individual demand and the market demand will decrease. As a consequence, individual supply and market supply for sellers will increase.
The law of supply demonstrates that as the quantity supplied increases so does the price. With prices continuing to rise and consumer demand dropping off, the price-per-unit cost of tuna would lose value because the quantity demanded at any individual price would decrease. As consumers’ tastes would begin to change, they would seek out substitute products. In this case, the substitutes are other sources of protein. Tuna then becomes more elastic, making consumers less price sensitive.
Eventually, the input price of labor would become too great, leading to downsizing, which hurts the economy as a whole. The loss of jobs would lead to a decrease in competition, and a decrease in trade between America, Europe and China. A left shift in the demand curve and a downward movement along the supply curve indicate a decrease in equilibrium as well as the development of a surplus. Also, the quantity of sellers decreases as labors costs soar. Once the industry has downsized, the new equilibrium has been reached and the problem of mercury is…

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