If the price of ricotta cheese, an ingredient in lasagna, increases, then
A) The market supply curve for lasagna will shift to the right.
B) The market supply curve for lasagna will shift to the left.
C) There will be a movement up along the market supply curve for lasagna.
D) There will be a movement down along the market supply curve for lasagna. If the cost of producing lasagna increases, the supply of lasagna will decrease.

Question

Quizplus · Accepted Answer

If the price of an ingredient like ricotta cheese increases, it will increase the cost of producing lasagna. Therefore, the marginal cost of producing each unit of lasagna will increase, which will lead to a decrease in the quantity supplied at each price point. Accordingly, the market supply curve for lasagna will shift to the left.

If the Price of Ricotta Cheese, an Ingredient in Lasagna