At the beginning of 2015, a 40-pound box of limes costs approximately $26. Howev

Question

At the beginning of 2015, a 40-pound box of limes costs approximately $26. However, by the end of 2015, the price of a 40-pound box of limes spiked to $130. Mexico, the world’s largest producer and exporter of limes, supplies the U.S. with 97% of the limes it consumes. Consider the following events in the lime market. Determine which two events together yielded the pricing result in the lime market during 2015.

1. More Americans celebrated Cinco de Mayo and other holidays by drinking margaritas, the tequila drink containing limes and lime juice.

2. New dental evidence suggested that the high ascorbic acid content in limes greatly increases corrosion of tooth enamel, leading Americans to decrease lime purchases.

3. Citrus greening disease killed thousands of lime trees across Mexico’s lime-growing regions.

4. The U.S. removed import tariffs on limes crossing the border from Mexico. An import tariff is a tax on imports.

___________

A. Events 1 and 3.

B. Events 2 and 4.

C. Events 1 and 4.

D. Events 2 and 3.

Explanation / Answer

Ans:

A. Events 1 and 3.

The price increased due to the increase in demand and decrease in supply.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.