Assume that in recent years the cost of producing microbrew beer in the U.S. has decreased largely due to technological improvements. At the same time, more and more Americans prefer microbrew beer over wine
Which of the following best explains the effect of these events in the microbrew beer market?
A) Both the supply and demand curves have shifted to the right. As a result, there has been an increase in both the equilibrium price and the equilibrium quantity.
B) Both the supply and demand curves have shifted to the right. As a result, there has been an increase in the equilibrium quantity and an uncertain effect on the equilibrium price.
C) The supply curve has shifted to the left and the demand curve has shifted to the right. As a result, there has been an increase in the equilibrium price and an uncertain effect on the equilibrium quantity.
D) The supply curve has shifted to the right and the demand curve has shifted to the left. As a result there has been a decrease in the equilibrium quantity and an uncertain effect on the equilibrium price.
B
You might also like to view...
The study of how people make decisions in situations where attaining their goals depends on their interactions with others is called
A) game theory. B) dominant strategy equilibrium. C) the prisoner's dilemma. D) Nash equilibrium.
The idea that individuals should be taxed in proportion to the marginal benefits that they receive from public goods is called
A) the horizontal-equity principle. B) the ability-to-pay principle. C) the benefits-received principle. D) the vertical-equity principle.