7. Why was there a line to get milk? Why did the orange juice prices drop?

There is a line for the milk because the quantity of milk supplied at that period is lower or lesser than the quantity demanded

QS < QD

The orange juice prices dropped because there is surplus supply of orange juice at that period than the quantity demanded.

QS >QD

Note: Where QD is Quantity Demanded

QS is Quantity Supplied

Explanation:

There is a line for milk because the dairy farmers supplied lesser quantity of milk in that particular period - thus the quantity demanded was higher than quantity supplied

- For the consumers the demand for milk is high since they prefer milk to orange juice - hence there is a line since the quantity supply for milk is low.

The orange juice prices drop because there is a surplus in quantity supply of orange juice, as against the quantity demanded at that time.

Hence, the prices has to go down, to enhance the consumers to buy the orange juice, since the consumers prefer the milk to orange juice.