Satisfying Your Sweet Tooth is About to Get More Expensive

Cocoa yields are underwhelming due to crop disease and heavy rains, and compared to last year’s cocoa season, this year’s is showing a reduction in production. In the year through April, chocolate prices went up 14.5% on average compared to the same period the year before.—cnn.com

Answer the following questions to check your understanding of the story.

1) What is happening in the market for cocoa?

In the market for cocoa, ____________.

a) supply is decreasing and the price is rising

b) supply is decreasing by more than demand is increasing, and the price is rising

c) supply is decreasing, which is decreasing demand so price is not changing

d) demand is increasing and the price is rising

2) How is the chocolate market moving to its new equilibrium?

_____________ creates a shortage. As the price rises _____________ and the shortage is eliminated.

a) An increase in the demand for chocolate; the supply of chocolate increases

b) An increase in the demand for chocolate; the quantity supplied increases, the quantity demanded decreases

c) A decrease in the supply of chocolate; the quantity supplied increases, the quantity demanded decreases

d) A decrease in the supply of chocolate; the demand for chocolate decreases

Satisfying Your Sweet Tooth is About to Get More Expensive

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