How Immigration Policy Impacts Your Avocados and Other Produce Fortune 6/19/18 \
ID: 1139810 • Letter: H
Question
How Immigration Policy Impacts Your Avocados and Other Produce Fortune 6/19/18
"To attract workers, farmers are raising wages to well above the minimum wage, which in California is $11 per hour, especially in higher cost places like Napa, Calif. Farmers are also increasingly paying for H-2A visas for guest workers.[...]
Beyond raising wages to lure more American workers, or recruiting H-2A visa workers, farmers are also switching from human labor-intensive crops like grapes, tomatoes, and avocados. Instead, they are focusing more on crops that require fewer workers like almonds or crops that can be harvested using automation like some lettuce, or moving growing to Mexico as is the case with asparagus.
“We’ve shifted away from the most labor-intensive crops – so things like vine-ripe tomatoes, we no longer grow anymore,” Oxnard, Calif.-based farmer Tom Deardorff told NPR. “We’ve also shifted a large amount of our production down into Mexico.”
Based on this article what would you expect to happen to the price of almonds in the US?
The price of almonds would increase due to the increase in the supply of almonds
The price of almonds would decrease due to the increase in the supply of almonds.
The price of almonds would increase due to the increase in the demand for almonds.
The price of almonds would decrease due to the increase in the demand for almonds.
Explanation / Answer
As farmers are shifting to the production of almonds due to highly automated production the supply of almonds will increase and the price of the good will decrease.
The answer is "B", The price of the good will decrease due to the increase in the supply of almonds.
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