Bicycles are made out of steel. If the price of steel increases, there is a shift in the supply curve of bicycles that leads to

Question

Quizplus · Accepted Answer

An increase in the price of steel, a key input in bicycle production, raises production costs for manufacturers. This typically leads to a decrease in supply (a leftward shift in the supply curve), which, with demand remaining constant, results in higher equilibrium prices for bicycles.

Bicycles Are Made Out of Steel