Exhibit 4.6 -Suppose the Market for Kids' Shoes Is Initially in Equilibrium

Exhibit 4.6

-Suppose the market for kids' shoes is initially in equilibrium. For a given upward-sloping supply curve, other things being equal, an increase in the price of Velcro which is used as fasteners for kids' shoes will result in a(n) _____

A) increase in both the equilibrium price and quantity of shoes.
B) increase in both the quantity demanded and quantity supplied of shoes.
C) increase in the equilibrium price but a decrease in the equilibrium quantity of shoes.
D) decrease in the equilibrium price but an increase in the equilibrium quantity of shoes.
E) decrease in both the quantity demanded and the quantity supplied of shoes.