An increase in costs associated with additional security measures taken by the airlines is most likely to lead to:

Question

Quizplus · Accepted Answer

An increase in costs associated with additional security measures taken by the airlines would increase the cost of production for the airlines, which would shift the supply curve to the left, leading to a decrease in the equilibrium quantity. At the same time, the increase in cost would also increase the price of airline tickets, leading to an increase in the equilibrium price. Therefore, the correct answer is an increase in equilibrium price and a decrease in equilibrium quantity.

An Increase in Costs Associated with Additional Security Measures Taken