A local bakery is facing a significant increase in the price of flour due to a recent drought affecting wheat production. As a result, the bakery decides to reduce the quantity of bread it supplies to the market. Which of the following best explains the shift in the supply curve for the bakery's bread?

Because the flour price rises, the bakery’s production cost goes up, so it can no longer produce as much bread at the same market prices. This higher cost makes some bread quantities unprofitable, so the bakery cuts back on output. The result is a leftward shift of the supply curve, showing a lower quantity supplied at each price. For example, if the bakery could sell 100 loaves at $3 each before the drought, after the cost increase it may only supply 60 loaves at the same price. This illustrates that a rise in input prices causes a supply curve to shift left.