Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
True
B
False
Understanding the Answer
Let's break down why this is correct
Answer
When the supply curve shifts to the left because production costs go up, it means that producers can make fewer goods at the same price. This increase in costs might come from things like higher wages or more expensive materials, making it harder for sellers to supply the same quantity of goods. As a result, to cover these costs, sellers often raise their prices. For example, if a bakery faces higher flour prices, it might sell fewer loaves of bread at a higher price. So, even if the demand for bread stays the same, the higher costs mean less bread is sold, and prices go up.
Detailed Explanation
This statement is true. Other options are incorrect because This answer suggests that higher prices and less quantity sold will always happen.
Key Concepts
Supply and Demand Interactions
Market Equilibrium
Price Elasticity
Topic
Supply and Demand Interactions
Difficulty
easy level question
Cognitive Level
understand
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