The figure below shows the supply curves for gasoline for two oil companies (MaxOil and MagnusPetro). It would be useful to find the equations of the two supply curves to answer the questions below.

-Refer to the figure above.Suppose that MaxOil,through a negotiation with the labor union representing its workforce,reduced its contribution to workers' health insurance.Meanwhile,MagnusPetro successfully negotiated to lower the price of ethanol (to be blended with its gasoline)with a supplier.How do these changes affect the supply curves?

Question

The figure below shows the supply curves for gasoline for two oil companies (MaxOil and MagnusPetro). It would be useful to find the equations of the two supply curves to answer the questions below.
 
-Refer to the figure above.Suppose that MaxOil,through a negotiation with the labor union representing its workforce,reduced its contribution to workers' health insurance.Meanwhile,MagnusPetro successfully negotiated to lower the price of ethanol (to be blended with its gasoline)with a supplier.How do these changes affect the supply curves?

Quizplus · Accepted Answer

Reducing costs, whether through lower labor costs (MaxOil) or lower input costs (MagnusPetro), makes production more profitable at any given price, leading to an increase in supply. This is represented by a rightward shift in the supply curves for both companies and the total market supply curve.

The Figure Below Shows the Supply Curves for Gasoline for Two