Scenario 14-5 A Study Sponsored by the Food Consumer Safety Board Found

question 205

Multiple Choice

Scenario 14-5
A study sponsored by the Food Consumer Safety Board found that consumption of irradiated tomatoes increased the health of laboratory rats. As a result of national press coverage of the report, the demand for irradiated tomatoes increased dramatically. Organic farmers were able to switch from organic production of tomatoes to irradiated production with no additional cost. Assume that the tomato market satisfies all of the assumptions of perfect competition.
-Refer to Scenario 14-5. If the increased production of irradiated tomatoes caused a rise in the marginal transportation costs of moving irradiated tomatoes to market, the

• A)short-run market supply curve for irradiated tomatoes would be affected but not the long-run market supply.
• B)long-run market supply curve for irradiated tomatoes would be perfectly elastic.
• C)long-run market supply of irradiated tomatoes would be downward sloping.
• D)long-run market supply of irradiated tomatoes would be upward sloping.

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Definitions:

Car Lubricant

A substance used in vehicles to reduce friction, heat, and wear between mechanical components that are in contact.

Sticker

A type of adhesive label or decoration which can be attached to surfaces for informational or decorative purposes.

Nonpersonal Selling

A promotional method using advertising, sales promotions, and other mass-market approaches to sell products, as opposed to direct, face-to-face sales.