Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 4 - Part II - The Market Forces of Supply and Demand - Quick Check Multiple Choice: 6


c. the increase in the prices of grapes, an input into jelly

Work Step by Step

The other three choices are examples of changes that will shift the demand curve for jelly. A change in demand moves equilibrium quantity and price of a good in the same direction. For example, an increase in consumer income would shift the demand curve to the right and increase both the equilibrium quantityand price of jelly. On the other hand, the increase in the price of an input will decrease the supply of jelly, which will shift the supply curve to the left. In this case, the new equilibrium quantity for jelly will decrease and the equilibrium price will increase.
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