According to the Australian Wool Innovation,severe Drought Conditions in Australia

question 206

Essay

According to the Australian Wool Innovation,severe drought conditions in Australia contributed to the lowest level of wool production in 50 years.This record low production has driven up prices sharply in Australian wool markets.Meanwhile,the price of raw cotton increased significantly for the first time in many years.
a.Illustrate this observation with one demand and supply graph for the market for Australian wool and another demand and supply graph for raw cotton.
b.Make sure that your graphs clearly show (1)the initial equilibrium before the decrease in the supply of Australian wool and (2)the final equilibrium.
c.Use arrows to indicate any shifts in the demand and supply curves for each market.
d.Label your graphs fully and write an explanation of your work.

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Definitions:

Environmental Changes

Alterations in the surrounding conditions, including natural, social, economic, and political environments, that can impact individuals and organizations.

Product Life Cycle

The series of stages a product goes through from introduction to growth, maturity, and decline, affecting marketing, sales strategies, and profitability.

Price Competition

A market condition where businesses focus on undercutting competitors' prices to attract customers.

Profit Declines

A decrease in the difference between revenues earned and expenses incurred over a given period.