The Print News Market: A Four-Step Analysis

Step 1. Draw the demand and supply model for the market before the event. D₀ and S₀ show the original relationships; here the analysis is done without specific numbers on the axes.

Step 2. Did the change affect supply or demand? A change in tastes, from print, radio and television news to digital sources, changed the demand for the former.

Step 3. Positive or negative? A shift to digital sources means a lower quantity of print news demanded at every price, so the demand curve shifts to the left, from D₀ to D₁.

Step 4. Compare the equilibria. The new equilibrium E₁ has a lower quantity and a lower price than the original E₀. The arrows on the axes show the direction of both changes.