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Figure: Market Changes
-(Figure: Market Changes) Refer to the figures. If these figures represent the market for blue jeans, which figure shows the effect of an increase in the price of denim, a raw material used to make jeans?
A) Figure A
B) Figure B
C) Figure C
D) Figure D

Question

Use the following to answer questions:
Figure: Market Changes 
-(Figure: Market Changes) Refer to the figures. If these figures represent the market for blue jeans, which figure shows the effect of an increase in the price of denim, a raw material used to make jeans?
A) Figure A 
B) Figure B 
C) Figure C 
D) Figure D

Quizplus · Accepted Answer

Figure A shows a leftward shift of the supply curve, indicating that an increase in the price of denim (a raw material used to make jeans) has caused a decrease in supply of blue jeans in the market. As a result, the equilibrium price has increased and the equilibrium quantity has decreased.

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