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Multiple Choice
A shift in the supply curve at every price is the result of a change in:
A
consumer income
B
the quantity demanded
C
a non-price determinant of supply, such as technology or input costs
D
the price of the good itself
Verified step by step guidance
1
Understand that a supply curve shows the relationship between the price of a good and the quantity supplied by producers.
Recognize that a shift in the supply curve means that at every price, the quantity supplied changes, which is different from a movement along the supply curve caused by a price change.
Identify that factors causing a shift in supply are called non-price determinants of supply, such as changes in technology, input costs, taxes, subsidies, or the number of sellers.
Note that changes in consumer income or quantity demanded affect the demand side, not the supply curve, so they do not cause a supply curve shift.
Conclude that a change in the price of the good itself causes movement along the supply curve, not a shift, so the correct cause of a supply curve shift is a non-price determinant of supply.