In the market for organic beef, which of the following would most likely cause an increase in the equilibrium price?

• A. A technological improvement in organic beef production
• B. A decrease in consumer preference for organic products
• C. A decrease in the price of conventional beef
• D. An increase in consumer income

Answer: (D)

Verified step by step guidance

1. Identify the factors that affect demand and supply in the market for organic beef. Demand factors include consumer preferences, income, and prices of related goods, while supply factors include technology and production costs.
2. Analyze how a technological improvement in organic beef production affects the market: it typically lowers production costs, increasing supply, which tends to lower the equilibrium price.
3. Consider a decrease in consumer preference for organic products: this reduces demand, shifting the demand curve leftward, which tends to lower the equilibrium price.
4. Examine the effect of a decrease in the price of conventional beef, a substitute good: this makes conventional beef relatively cheaper, reducing demand for organic beef and lowering its equilibrium price.
5. Understand how an increase in consumer income affects demand for organic beef, which is often considered a normal or luxury good: higher income increases demand, shifting the demand curve rightward, which tends to raise the equilibrium price.