Problem
California supplies the United States with 80% of its eating oranges. In late 1998, four days of freezing temperatures in the state's Central Valley substantially damaged the orange crop. In early 1999, Food Lion, with 1,208 grocery stores mostly in the Southeast, said its prices for fresh oranges would rise by 20% to 30%, which was less than the 100% increase it had to pay for the oranges. Explain why the price to consumers did not rise by the full amount of Food Lion's price increase. What can you conclude about the elasticities of supply and demand for oranges?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.