Figure 4-21

-Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for bread of an increase in the price of flour?

Question

Figure 4-21
 
-Refer to Figure 4-21.Which of the following movements would illustrate the effect in the market for bread of an increase in the price of flour?

Quizplus · Accepted Answer

An increase in the price of flour would shift the supply curve to the left, resulting in a higher equilibrium price and lower equilibrium quantity. This is illustrated by the movement from point C to point D, where the price of bread increases and the quantity demanded decreases. Movements from points A to B or D or from C to B would not be affected by an increase in the price of flour.

Figure 4-21 -Refer to Figure 4-21.Which of the Following Movements Would Illustrate