If the cost to produce frozen chicken nuggets decreases at the same time as consumer tastes shift away from frozen chicken nuggets and the shift in demand is equal to the shift in supply, which of the following is true?

Question

Quizplus · Accepted Answer

The decrease in production costs will cause a shift in the supply curve to the right, which will decrease the equilibrium price and potentially increase the equilibrium quantity. However, the shift in consumer tastes away from frozen chicken nuggets will cause a shift in the demand curve to the left, which will decrease the equilibrium quantity. Since the two shifts are equal, the equilibrium quantity will not change, but the equilibrium price will decrease. Therefore, choice C is the correct answer.

If the Cost to Produce Frozen Chicken Nuggets Decreases at the Same