If the price of rubber were to increase by 20 percent over the fiscal year and if all else were held constant,what would we expect to happen to the supply curve of tires that are sold separately from automobiles?

Question

Quizplus · Accepted Answer

An increase in the price of rubber, a key input in tire production, would increase the cost of producing tires. As a result, some tire manufacturers may find it unprofitable to produce as many tires at each price level, leading to a decrease in the quantity supplied at each price level. This would cause the supply curve of tires to shift to the left.

If the Price of Rubber Were to Increase by 20