Use the following diagram to answer the following questions.

-Refer to Diagram 4-2. Suppose equilibrium price and quantity exchanged are initially P₂ and Q₄, respectively. If the wage paid to peach pickers increases, then the new equilibrium price and quantity of peaches exchanged will be:

Question

Use the following diagram to answer the following questions.
 
-Refer to Diagram 4-2. Suppose equilibrium price and quantity exchanged are initially P₂ and Q₄, respectively. If the wage paid to peach pickers increases, then the new equilibrium price and quantity of peaches exchanged will be:

Quizplus · Accepted Answer

An increase in the wage paid to peach pickers would increase the cost of producing peaches, leading to a decrease in supply. This would shift the supply curve to the left, resulting in a higher equilibrium price (P₄) and a lower equilibrium quantity (Q₂) exchanged.

Use the Following Diagram to Answer the Following Questions