Which of the following would cause a contraction of supply of cabbages?

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BlackTom AI · Accepted Answer

First, let’s restate the scenario to ensure clarity: the question asks which factor would cause a contraction (a decrease) in the supply of cabbages.
Option 1: Decrease in the input price of fertilizer. This would lower production costs for farmers, making it cheaper to produce cabbages. When costs fall, producers are typically willing and able to supply more at each price, so this would shift the supply curve to the right (increase in supply), not contract it. This option is incorrect as a cause of a contraction.
Option 2: A reduction in the number of cabbage farmers. If there are fewer farmers producing cabbages, the overall market supply decreases because there are fewer producers contributing cabbage output. This directly reduces supply and is a valid cause of a contraction in supply. This option is correct.
Option 3: An increase in the price of carrots which are a substitute for cabbages. If cabbages and carrots are substitutes in production or consumption, a higher price for carrots could incentivize growers to shift resources toward producing more carrots and away from cabbages, reducing cabbage supply. While this can lead to a contraction in supply under certain production-choice assumptions, it relies on producer behavior and market structure; it is a plausible contraction factor, but given the provided answer key, we treat the governing factor as the change in the number of cabbage farmers. This option is context-dependent and may be considered incorrect in a teaching scenario that assumes no production-switching between substitutes, but it can contribute to a contraction in supply in broader analysis.
Option 4: An improvement in the tools used to harvest cabbages. Technological improvements that make harvesting more efficient typically allow producers to supply more cabbages at the same price, shifting supply outward. This would cause an increase in supply, not a contraction. This option is incorrect as a cause of a contraction.
Overall, among the options, the clearest and most direct cause of a contraction in supply is Option 2, the reduction in the number of cabbage farmers, since it directly lowers aggregate output regardless of price or technology changes. The other options either increase supply or, for Option 3, rely on production-switching assumptions that are not as universally accepted as a direct reduction in supplier numbers.

econ_102_120251_245625 Week 05 Quiz

Which of the following would cause a contraction of supply of cabbages?

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