Asked by
Andrew Teixeira
on Oct 14, 2024
Verified
Suppose that the garden gnome industry was in long-run equilibrium given the circumstances described .Suppose,, that it was discovered to everyone's surprise on January 1, 1993, after it was too late to change orders for gnome molds, that the cost of the plaster and labor needed to make a gnome had changed to $9.If the demand curve does not change, what will happen to the equilibrium price of gnomes?
A) Stays constant.
B) Rises by $2.
C) Falls by $2.
D) Rises by $9.
E) Falls by $4.50.
Demand Curve
Illustrates the willingness of consumers to buy a particular quantity of a good at various price levels, with a downward slope indicating that as price decreases, demand increases.
Plaster
A building material composed of water, lime, and sand, used for coating walls and ceilings or for creating architectural decorations.
Labor
The physical and mental effort used in the production of goods and services by workers.
- Examining the fluctuations in production expenses and their impact on supply and demand dynamics.
- Examining the repercussions of supply and demand alterations on industry stability.
Verified Answer
FD
Learning Objectives
- Examining the fluctuations in production expenses and their impact on supply and demand dynamics.
- Examining the repercussions of supply and demand alterations on industry stability.