Supply and Demand Assignment

Source: Red chilli prices crash 40% in two weeks

Market: Chilli

Chilli prices in Telangana, India have dropped by over 40% in two weeks due to a surplus of the good.

The chilli market in the country has increased, on average, 50,000-60,000 bags (of 40-50 kg each) a day. This means there has been a large increase in the number of sellers in the market. This moves the supply curve to the right and creates a surplus in the market, dropping the equilibrium price of chilli dramatically. The price dropped from 12,500-13,000 about two weeks earlier to 7,000 a quintal.

Chilli market Supply and Demand Assignment


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