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16 August, 09:56

The following example illustrates which of the following factors that can cause a shift in supply? If the price of lumber decreases, the Crystal Match Company would increase its supply of matches, because it would be making more profit off of each box.

a. changes in technology

b. government involvement

c. changes in the prices of inputs

d. changes in the prices of other goods

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  1. 16 August, 13:35
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    The answer is C. Changes in prices of inputs

    Lumber is the raw material in producing matches (the inputs). If the price of lumber is currently dropped, it is rational for the company to increase the supply of matches to gain more profit.

    So option C is an appropriate answer in this case
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