Crane Sales Company uses the retail inventory method to value its merchandise inventory. The following information is available

Response:

There will be an increase in equilibrium quantity, but the impact on equilibrium price remains uncertain.

Note:

Due to the scientists' discovery, demand for oranges will rise, as will the price.

Additionally, the introduction of new fertilizers will boost the supply of oranges, leading to a price decrease.

Taking both of these factors into account indicates that there will be a rise in equilibrium quantity, while the effect on equilibrium price cannot be determined.