We observe that the equilibrium price of digital cameras has fallen and the equilibrium quantity of digital cameras has increased. Which of the following events could be responsible for this?

Question

Quizplus · Accepted Answer

Technological advances in digital camera production would shift the supply curve to the right, causing a decrease in the equilibrium price and an increase in the equilibrium quantity. An increase in worker wages (choice C) would shift the supply curve to the left, causing an increase in the equilibrium price and a decrease in the equilibrium quantity. A rise in the price of film cameras (choice A) and a change in consumer preferences (choice B) would both shift the demand curve, but we cannot determine the direction of the shifts without more information.

We Observe That the Equilibrium Price of Digital Cameras Has