Asked by Alanna Cooperman on May 17, 2024
Verified
Suppose the input costs associated with manufacturing hair replacement treatments decrease over time.This would lead to a(n) :
A) increase in the supply of such treatments,lower prices,and an increase in the equilibrium quantity.
B) decrease in quantity supplied and lower prices.
C) increase in demand and higher prices.
D) decrease in the supply of such treatments,higher prices,and a decrease in the equilibrium quantity.
Input Costs
The expenses incurred to purchase the raw materials, labor, and other resources needed to produce goods or services.
Hair Replacement
A set of medical or cosmetic techniques aimed at restoring hair to balding or thinning areas of the scalp.
Equilibrium Quantity
The quantity of goods or services supplied and demanded at the equilibrium price, where the quantity demanded equals the quantity supplied.
- Identify how modifications in input expenses alter the market's equilibrium state.
Verified Answer
KB
Kendra BrownMay 19, 2024
Final Answer :
A
Explanation :
If input costs decrease, the production cost of manufacturing hair replacement treatments decreases. As a result, the supply of hair replacement treatments would increase due to the lower cost, and the price of such treatments would decrease. Due to the lower prices, consumers would demand more treatments, leading to an increase in the equilibrium quantity.
Learning Objectives
- Identify how modifications in input expenses alter the market's equilibrium state.