1. Resource X is necessary in the production of good Y. If the price of resource X decreases A. the supply curve of Y shifts leftward. B. the supply curve of Y shifts rightward. C. the supply curve of Y is unaffected. D. there is a movement down along the supply curve of Y. E. there is a movement up along the supply curve of Y.
1. Resource X is necessary in the production of good Y. If the price of resource X decreases A. the supply curve of Y shifts leftward. B. the supply curve of Y shifts rightward. C. the supply curve of Y is unaffected. D. there is a movement down along the supply curve of Y. E. there is a movement up along the supply curve of Y.
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter3: Supply And Demand: Theory
Section3.2: Supply
Problem 2ST
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Question
1. Resource X is necessary in the production of good Y. If the price of resource X decreases
A. the supply curve of Y shifts leftward.
B. the supply curve of Y shifts rightward.
C. the supply curve of Y is unaffected.
D. there is a movement down along the supply curve of Y.
E. there is a movement up along the supply curve of Y.
Expert Solution
Step 1
First of all, we need to understand the difference between the change in quantity demanded and the change in demand.
Change in quantity demanded/ quantity supplied: when the own price of good changes, there is a movement along the demand curve.
Change in demand/ supply: When the demand or supply curve shifts either leftwards or rightward due to reasons (like, change in taste or preference, change in income, change in price of related goods) other than change in own price of a good.
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