Answer to Question #62817 in Microeconomics for John Smith

Question

Given the rising price of Cocoa and sugar, Mars cut down the size of Snicker bars. Given your answer for question number 1, what would you predict will
happen?
a. Explain

REFER TO THIS BELOW: http://www.theguardian.com/business/interactive/2010/jan/20/cadbury-kraftnestle-mars-ferrero

Answer 1

If given the rising price of Cocoa and sugar, Mars cut down the size of Snicker bars, we would predict that as the real price of Snicker bars increased according to the decrease in size, then the quantity of Snicker bars sold will decrease.