Illustrating graphically and specifically the assumptions upon which your reasoning is based, describe briefly with references
i. The effects on the price and output of fresh maize of adverse weather conditions.
ii. The effects on the price and output of oranges of an increase in consumers income
i. Adverse weather conditions can have a significant impact on the price and output of fresh maize. Graphically, this can be illustrated using a supply and demand diagram.
Assuming that adverse weather conditions reduce the supply of maize, the supply curve (S) will shift to the left. This shift indicates a decrease in the quantity supplied at each price level. The new supply curve (S') will intersect with the original demand curve (D) at a higher price (P'), indicating a decrease in output and an increase in the price of fresh maize.
Additionally, adverse weather conditions can also affect the demand for fresh maize. For instance, if adverse weather damages other crops and reduces their supply, consumers may shift their demand towards maize as a substitute. In this case, the demand curve (D) would shift to the right, and the intersection with the new supply curve (S') would result in an even higher price (P'') and potentially higher output.
Overall, the graphical representation shows that adverse weather conditions lead to a decrease in the output of fresh maize and an increase in its price.
ii. An increase in consumers' income can affect the price and output of oranges in the market. Again, this can be illustrated using a supply and demand diagram.
Assuming that an increase in consumers' income leads to an increase in their demand for oranges, the demand curve (D) would shift to the right. The intersection of the new demand curve (D') with the original supply curve (S) would result in a higher price (P') and potentially higher output of oranges.
This increase in consumers' income can also lead to shifts in the supply curve. If orange producers expect higher demand due to increased consumer income, they may increase their production, resulting in a rightward shift of the supply curve (S'). The intersection of the new supply curve (S') with the new demand curve (D') would lead to a lower price (P'') and potentially higher output of oranges.
In summary, an increase in consumers' income can lead to an increase in the demand and supply of oranges, resulting in either an increase or decrease in the price and an increase in output, depending on the relative magnitudes of the shifts in supply and demand.