Suppose that both of the events you have just analyzed are partly responsible fo

Question

Suppose that both of the events you have just analyzed are partly responsible for the decrease in the price of hamburgers. Based on your analysis of the explanations offered by the two groups of students, how would you figure out which of the possible causes was the dominant cause of the decrease in the price of hamburgers?

a. Whichever change occurred first must have been the primary cause of the change in the price of hamburgers.

b. If the equilibrium quantity of hamburgers decreases, then the demand shift in the market for hamburgers must have been larger than the supply shift.

c. If the equilibrium quantity of hamburgers decreases, then the supply shift in the market for hamburgers must have been larger than the demand shift.

d. If the price decrease was small, then the supply shift in the market for hamburgers must have been larger than the demand shift.

Explanation / Answer

Ans) c

If the equilibrium quantity of hamburgers decreases, then the supply shift in the market for hamburgers must have been larger than the demand shift.

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