Figure 3.8 -Refer to Figure 3.8.The Graph in This Figure Illustrates an Figure

question 120

Multiple Choice

Figure 3.8
-Refer to Figure 3.8.The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D₁ and S₂ (point B) . If there is a decrease in the price of fertilizer used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks, how will the equilibrium point change?

• A)The equilibrium point will move from B to A.
• B)The equilibrium point will move from B to C.
• C)There will be no change in the equilibrium point.
• D)The equilibrium point will move from B to E.

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Definitions:

Sellers

Individuals or entities that offer goods or services for sale in the marketplace.

Equilibrium Price

The price at which the quantity of goods demanded equals the quantity of goods supplied.

Excess Demand

Excess demand occurs when the quantity demanded of a product or service exceeds the quantity supplied at the current price, leading to shortages.

Excess Supply

A market situation where the quantity of a good or service offered is greater than the quantity demanded by consumers.