There is an increase in the number of adverts highlighting the dangers of consuming artificial sweeteners (as opposed to sugar). Which of the following is likely to occur in the market for sugar, as a result of this?
An increase in both price and equilibrium quantity traded
A decrease in price and an increase in equilibrium quantity traded
A decrease in both price and equilibrium quantity traded
An increase in price and a fall in equilibrium quantity traded
An increase in price and a fall in equilibrium quantity traded.
This is because as consumers become more aware of the dangers of consuming artificial sweeteners, they are likely to shift towards using sugar as a sweetening agent instead. This increase in demand for sugar will lead to an increase in price, while the fall in demand for artificial sweeteners will lead to a decrease in their price and equilibrium quantity traded.