Refer to the above diagram, which shows three supply curves for corn.Which of the following would cause the change in the supply of corn illustrated by the shift from S₁ to S₃?

Question

Quizplus · Accepted Answer

An increase in the price of irrigation equipment would lead to a decrease in the supply of corn, shifting the supply curve leftward from S₁ to S₃. This is because the cost of production is now higher, which makes it less profitable for farmers to produce corn at every price level. A decrease in the price of fertilizer (choice A) would shift the supply curve to the right, since it would lower production costs and increase profitability. Choices C and D do not directly affect the supply of corn.

Refer to the Above Diagram, Which Shows Three Supply Curves