Fishing Along The Gulf Coast

The supply demand characteristics can be explained by the following graphs The above graph clearly illustrates the economic impact of the oil spill in Louisiana, if the situation gets out of hand. If the National Oceanic and Atmospheric Administration restricts the harvesting of seafood further and that oil spill spreads to the larger area thus affecting the quality of the food harvested. This would lead to the shift in the supply curve as shown above. The supply will be restricted and with the demand remaining constant the price will rise and reach a new equilibrium level. If the demand of the product goes down due to the quality concerns about the products then this would lower the equilibrium price of the product as Qty Price Demand Supply Equilib Qty before the oil spill Equilib Price before the oil spill Equilib Price after the oil spill Equilib Qty after the oil spill Restricted Supply Demand lowered due to quality concerns Equilib price due to lower demand