Use the Figure Below to Answer the Following Question(s)

question 138

Multiple Choice

Use the figure below to answer the following question(s) .
Figure 3-8
-In Figure 3-8, if the initial demand and supply for soybeans were D₁ and S₁, how would a decrease in the cost of producing soybeans affect the market for soybeans?

• A) Demand would increase to D₂, price would increase to P₂, and the quantity would increase to S.
• B) Supply would increase to S₂, price would decrease to P₀, and the quantity would increase to S.
• C) Both demand and supply would increase so the price would remain at P₁, but the quantity would increase to T.
• D) None of the above would occur.

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