Market: European Cod
The price of cod in Europe has risen steadily in the last year. This increase in price has been caused by an increase in demand and a decrease in supply. The factor behind the increase in demand is the increase of the price of salmon. Since salmon is a substitute good to cod, an increase in the price of salmon led to many buyers purchasing cod instead. This caused the demand curve to shift right. The reason for the decrease in supply is the strike of the Icelandic fishermen. This strike has lowered the number of sellers, thus decreasing the supply of cod. This caused the supply curve to shift left. The combination of the demand curve shifting right and the supply curve shifting left has resulted in a rise in the price of cod.