Refer to the information provided in Figure 9.2 below to answer the question(s) that follow. Figure 9.2
-Refer to Figure 9.2. Suppose demand for wheat is initially D₂. If the price of rice (a substitute for wheat) rises, then demand for wheat will shift to ________. This will ________ the equilibrium price of wheat and individual profit-maximizing firms will produce ________ bushels of wheat.

Question

Refer to the information provided in Figure 9.2 below to answer the question(s) that follow.

Figure 9.2
-Refer to Figure 9.2. Suppose demand for wheat is initially D₂. If the price of rice (a substitute for wheat) rises, then demand for wheat will shift to ________. This will ________ the equilibrium price of wheat and individual profit-maximizing firms will produce ________ bushels of wheat.

Quizplus · Accepted Answer

When the price of a substitute (like rice) increases, demand for the alternative product (wheat, in this case) will increase as consumers switch to the cheaper alternative. This increased demand shifts the demand curve to the right, leading to a higher equilibrium price and encouraging producers to supply more, hence the choice indicating an increase in both price and quantity produced is correct.

Refer to the Information Provided in Figure 9