Suppose that the shrimp industry is in long-run equilibrium at a price of $5 per pound of shrimp and a quantity of 200 million pounds per year. Suppose that the Centers for Disease Control (CDC) announces that a chemical found in shrimp helps prevent many viral infections from spreading around the world.
The CDC’s announcement will cause consumers to demand shrimp at every price. In the short run, firms will respond by .

The CDC’s announcement will cause the quantity of chicken demanded to decrease at every price, shifting the demand curve inward. In the short run, the number of firms in the chicken industry is fixed. Therefore, the shift in demand causes a movement along the short-run supply curve. The price of chicken decreases and each firm produces less chicken than before. Because the chicken industry was originally in long-run equilibrium, firms were earning zero profit before the CDC’s announcement. Therefore, a decrease in price would cause firms to run at a loss.

JackelineCasarez JackelineCasarez · Answer 2 · 2021-11-17T10:28:52+01:00

In the given situation, the Centers for Disease Control department's declaration causes more demand for Shrimp in the market at any price. This will result in the firms countering it by

- Producing more shrimp and earning +ve(positive) profit.

As per the claim of the CDC(Centers for Disease Control), the demand for Shrimps would significantly increase as people will be influenced by the statement regarding the assistance it provides in safeguarding them from 'viral infections.'
Since the demands increase, the firms would attempt to produce more and sell as much as they can to make a maximum profit as the consumers are willing to buy at any price.
This will result in a shift in the supply curve to meet the existing demands of the consumer.

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