Both Economist Flores and Economist Jenkins have been monitoring the cucumber market and have noted that the equilibrium price of cucumbers and quantity of cucumbers sold have risen over the last year. Flores and Jenkins, however, disagree about why
this change has occurred. Flores holds that both supply and demand have increased and that the shift in demand has been greater than the shift in supply. Jenkins, however, argues that while demand has increased, supply has decreased and the shift in supply is greater than the shift in demand. Which economist offers the most feasible theory of why the equilibrium price and quantity of cucumbers have risen?
Please provide the best answer for the statement.
Flores offers the most feasible explanation. By graphing the two explanations, Flores’ theory that both supply and demand have increased and that the shift in demand has been greater than the shift in supply does provide a result where both price and quantity increase. Jenkins’ theory that while demand has increased, supply has decreased and the shift in supply is greater than the shift in demand produces a result where price increases and quantity decreases.
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