Tag Archives: Food Prices

Supply and Demand

Market: Restaurants

Source: http://business.financialpost.com/pmn/business-pmn/ontario-restaurant-price-hikes-boost-food-inflation-after-minimum-wage-increase

Ontario restaurant prices are rising. Many economists agree that this is a direct result of the recent minimum wage increase, going from $11.60/h to $14/h, implemented January 1, 2018. This change in the cost of factors of production caused a 3.7% increase in restaurant food prices in January, as the cost of labour resources increased. The supply curve has shifted to the left as supply decreases, so the new equilibrium point has both less quantity supplied and a higher price.

Supply and Demand Curve for Restaurant Prices