Figure 3-11

-In Figure 3-11,suppose D₁ and S₁ indicate initial conditions in the market for kitchen cabinets.Which of the following would tend to cause the supply curve to shift from S₁ to S₂?

Question

Figure 3-11
 
-In Figure 3-11,suppose D₁ and S₁ indicate initial conditions in the market for kitchen cabinets.Which of the following would tend to cause the supply curve to shift from S₁ to S₂?

Quizplus · Accepted Answer

A decrease in the price of wood, a resource used to produce kitchen cabinets, would lower the cost of producing kitchen cabinets and shift the supply curve to the right from S₁ to S₂. The invention of "folding" plates and cups that take up less storage space would not directly affect the production of kitchen cabinets. A decrease in consumer income would cause a decrease in demand for kitchen cabinets and shift the demand curve, not the supply curve. An increase in the price of steel hinges, a resource used to produce kitchen cabinets, would increase the cost of production and reduce the supply, shifting the supply curve to the left.

Figure 3-11 -In Figure 3-11,suppose D₁ and S₁ Indicate Initial Conditions in Indicate