Figure 4-15 -Refer to Figure 4-15.Which of the Following Would Cause the Would

question 44

Multiple Choice

Figure 4-15
-Refer to Figure 4-15.Which of the following would cause the supply curve to shift from Supply A to Supply C in the market for beach towels?

• A)an increase in the price of beach towels
• B)an expectation by firms that the price of beach towels will increase in the very near future
• C)a decrease in the price of cotton
• D)a decrease in the number of firms selling beach towels

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Definitions:

Labor Supply Curve

A graphical representation showing the relationship between the wage rate and the quantity of labor that workers are willing to supply.

Substitution Effect

The change in consumption patterns due to a change in relative prices, leading consumers to replace more expensive items with cheaper alternatives.

Income Effect

The change in an individual's or economy's income and how that change will affect the quantity demanded of a good or service.

Substitution Effect

The change in consumption patterns due to a change in the relative prices of goods, making consumers substitute one good for another.