Question

Which of the following could cause a change in supply in the market for bottles of antibacterial soap? (as opposed to a change in the quantity supplied.)

(A) a decrease in the price of hydrogen peroxide, a substitute for antibacterial soap.
(B) an information campaign showing that antibacterial soap is ineffective.
(C) an increase in the cost of plastic bottles used as containers for antibacterial soap.
(D) None of the above.

Answer 1

C

Step-by-step explanation:

A. If there is a decrease in the price of a substitute good then people will prefer that good because is cheaper than, in this case, antibacterial soap. This will cause a change in demand, because consumers decide to buy less antibacterial soap.

B. The campaign will affect consumers because now there would be less people interested on buying the antibacterial soap. This will cause a change in demand.

C. An increase in the cost of plastic bottles used for antibacterial soap will affect directly to producers because now the total cost of production will increase and for instance they will produce less. This will cause a change in supply