Higher steel prices will result in a shift in the supply curve of bicycles, and this will lead to
A)higher prices for bicycles.
B)lower prices for bicycles.
C)a shift in the demand curve for bicycles.
D)a larger output of bicycles.
E)no impact on the price of bicycles.

Question

Quizplus · Accepted Answer

A shift in the supply curve due to higher steel prices will cause a decrease in the quantity supplied of bicycles at any given price. This means that to maintain profitability, bicycle manufacturers will have to raise the prices of bicycles which will lead to higher prices for bicycles.

Higher Steel Prices Will Result in a Shift in the Supply