Final answer:
A decrease in price will most likely cause a decrease in the quantity supplied, as suppliers tend to produce less when they make less profit per unit sold. In financial markets, a rise in supply leads to lower interest rates and an increase in the quantity of loans made.
Step-by-step explanation:
The question asks which of the following would most likely cause a decrease in the quantity supplied. The correct answer is D) A decrease in price. According to the law of supply, there is a direct relationship between price and the quantity supplied: as the price of a good or service increases, suppliers will produce more of it to maximize profit. Conversely, when prices decrease, the quantity supplied tends to decrease because producing and selling less becomes more profitable or reduces losses.
Regarding changes in the financial market, a rise in supply will likely lead to a decline in interest rates, as more supply of money competes for borrowers, bringing down the cost of borrowing money. Similarly, a rise in the supply of loans would lead to an increase in the quantity of loans made and received, given that there is more availability of loans at possibly lower interest rates.
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