Figure 3-8 -Refer to Figure 3-8.The Graph in This Figure Illustrates an Figure

question 72

Multiple Choice

Figure 3-8
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D2 and S1 (point C) .Which of the following changes would cause the equilibrium to change to point B?

• A)A positive change in the technology used to produce motorcycles and decrease in the price of motorcycle insurance,a complement to motorcycles.
• B)An increase in the wages of motorcycle workers and a decrease in the price of motorcycle insurance,a complement to motorcycles.
• C)An increase in the number of motorcycle producers and an increase in the number of consumers who prefer riding motorcycles.
• D)An increase in the wages of motorcycle workers and an increase in the price of motorcycle insurance,a complement to motorcycles.

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Definitions:

Price of a Resource

The monetary value assigned to a raw material, energy, or other fundamental inputs used in the production of goods and services.

Substitute Inputs

Alternatives that can be used in the production process if the original inputs become too expensive or unavailable.

Consumers

Individuals or groups who use goods and services to satisfy their personal needs and desires.

Unskilled Labor

Workforce with no special training or qualifications, often associated with manual or simple tasks.