Shift in demand is expected to be temporary or permanent

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The 2010 oil spill in the Gulf of Mexico caused the oil firm BP and the US government to greatly increase purchases of boat services, various oil-absorbing materials, and other goods and services to minimize damage from the spill. Use side-by-side firm and market diagrams to show the effects (number of firms, price, output, profits) of such a shift in demand in one such industry, such as boat services, in both the short run and the long run.

Explain how your answer depends on whether the shift in demand is expected to be temporary or permanent.

Reference no: EM131091260

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