The discovery of a new fertilizer will shift the ___________ curve for carrots, leading to a ___________ equilibrium price.

• A. demand, higher
• B. demand, lower
• C. supply, higher
• D. supply, lower

Answer: (D)

Verified step by step guidance

1. Identify the type of curve affected by the discovery of a new fertilizer. In this case, a new fertilizer affects the production process, which is related to the supply side of the market.
2. Understand that the supply curve represents the relationship between the price of a good and the quantity supplied. A new fertilizer likely increases the productivity of carrot farming, allowing more carrots to be produced at each price level.
3. Recognize that an increase in supply is represented by a rightward shift of the supply curve. This means that at every price level, a greater quantity of carrots is now available.
4. Consider the impact of a rightward shift in the supply curve on the equilibrium price. With more carrots available, the increased supply tends to lower the market price, assuming demand remains constant.
5. Conclude that the discovery of a new fertilizer shifts the supply curve for carrots to the right, leading to a lower equilibrium price in the market.