Suppose that sales of a product depend directly on economic growth. If producers of that product expect an economic recession in the near future, there is likely to be

Question

Quizplus · Accepted Answer

If producers expect an economic recession in the near future, they will anticipate a decrease in economic growth, which will, in turn, decrease demand for their product. This will lead to a leftward shift of the supply curve, as producers will supply less of their product at any given price.

Suppose That Sales of a Product Depend Directly on Economic