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Question
Macroeconomics
Posted 6 months ago

This graph illustrates two supply curves.
Two suply curves

Which of the following movements would be described as an increase in the supply of a good?

Choose 1 answer:
(A) DD to CC
(B) DD to AA
(c) BB to AA
(D) AA to CC
(E) AA to DD
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Answer from Sia
Posted 6 months ago
Solution
a
Increase in Supply: An increase in the supply of a good is represented by a shift of the supply curve to the right
b
Analyzing the Graph: Movement from BB to AA indicates a shift from the original supply curve S1S1 to the new supply curve S2S2, which is to the right of S1S1. This represents an increase in supply at every price level since at the same price more quantity is supplied
Answer
(C) BB to AA
Key Concept
Rightward Shift of Supply Curve
Explanation
A movement from a point on the original supply curve to a point on a new supply curve that lies to the right of the original indicates an increase in supply.

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