Figure 3-6 -In Figure 3-6, suppose D₁ and S₁ indicate initial conditions in the market for ice cream. Which of the following changes would tend to cause a shift from S₁ to S₂ in the market for ice cream? A) an increase in the price of sugar, an ingredient used to produce ice cream B) a decrease in the price of frozen yogurt, a substitute for ice cream C) abnormally hot weather that temporarily increases consumer desire for ice cream D) a decrease in the price of milk, an ingredient used to produce ice cream

Question

Quizplus · Accepted Answer

A decrease in the price of milk, an ingredient used to produce ice cream, would lower production costs, leading to an increase in supply, causing the supply curve to shift from S1 to S2.

Figure 3-6 -In Figure 3-6, Suppose D1 and S1 Indicate Initial Conditions

Figure 3-6 -In Figure 3-6, Suppose D₁ and S₁ Indicate Initial Conditions