The graph contains individual supply curves for the only two firms in a hypothetical market for stuffed animals. Place the market supply curve at the correct location on the graph. Then, consider what would happen to the market if a third supp enters the market, holding all else constant. Price per Stuffed Animal(5) 10 9 8 N 6 3 De Market for Stuffed Animals Firm Firm 2 Market O 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 A third firm would mean O market supply increases. O higher prices of stuffed animals. market supply decreases. O Firm 1 and Firm 2 would lower output to accommodate the new supplier in order to keep market supply constant.
The graph contains individual supply curves for the only two firms in a hypothetical market for stuffed animals. Place the market supply curve at the correct location on the graph. Then, consider what would happen to the market if a third supp enters the market, holding all else constant. Price per Stuffed Animal(5) 10 9 8 N 6 3 De Market for Stuffed Animals Firm Firm 2 Market O 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 A third firm would mean O market supply increases. O higher prices of stuffed animals. market supply decreases. O Firm 1 and Firm 2 would lower output to accommodate the new supplier in order to keep market supply constant.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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