An increase in the price of milk increases the cost of manufacturing cheese. The market for cheese will change to a new equilibrium because there will be:

Question

BlackTom AI · Accepted Answer

To begin, consider what drives a change in the cheese market when the price of a key input (milk) rises.
Option a: A leftward shift in the demand curve for cheese. This would occur if buyers suddenly wanted less cheese at every price, perhaps due to a change in preferences or incomes. However, a higher milk price raises costs of production, not consumers’ willingness to purchase cheese at existing prices, so this option misattributes the cause to demand rather than supply.
Option b: A leftward shift in the supply curve for cheese. This correctly captures the effect of higher input costs: producers supply less cheese at each price because producing cheese becomes more expensive. The supply curve shifts left, leading to a higher equilibrium price and a lower equilibrium quantity, holding other factors constant.
Option c: An increase in the demand for milk. While this would affect the milk market, it does not directly describe a shift in the cheese market’s supply. The question focuses on how the cheese market responds to a higher price of milk used to produce cheese, not on demand changes for milk itself.
Option d: A decrease in the demand for cheese. A drop in demand would shift the demand curve left, reducing quantity and price for cheese, but it does not reflect the production cost increase caused by pricier milk. The primary channel from a higher input cost is a supply-side shift, not a demand-side change.

MCD2020 - T1 - 2025 Tutorial Quiz 2 - Market Forces of Supply and Demand

An increase in the price of milk increases the cost of manufacturing cheese. The market for cheese will change to a new equilibrium because there will be:

查看解析

登录即可查看完整答案

类似问题

An improvement in production technology will shift the

Part D: An increase in the price of pizza sauce will cause a movement from point B on supply curve S2 to

Part B: An increase in supply is represented by the movement from S2 to

What effect would a new tax on producers likely have on the supply curve?

A student says “Supply of ice cream increases with increasing population”. How will you show this change in the market diagram?

A student says “Supply of ice cream decreases with decreasing population”. How will you show this change in the market diagram?

Figure 4-6Refer to Figure 4-6. The shift from S' to S could be caused by

Select the correct answer about the figure above.

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单