Question

In 1914, Europe plunged into World War I, causing some button manufacturers to switch from using MOP to using tin, wood, or bone. This would have decreased ____, resulting in a decrease in the price of MOP.

A. demand and supply
B. quantity demanded
C. supply and then quantity demanded
D. demand and then quantity supplied

Answer 1

The shift from using mother-of-pearl to alternatives during WWI resulted in a decrease in demand, leading to a decrease in the quantity demanded of MOP and a subsequent drop in its price.

Step-by-step explanation:

In 1914, when Europe plunged into World War I, many button manufacturers shifted from using mother-of-pearl (MOP) to alternatives like tin, wood, or bone. This switch decreased the demand for MOP. Without a need for as much MOP, fewer buttons and other products would be made with it, which would lead to a decrease in demand for the material.

As a result, with demand decreasing, the quantity demanded at each price level would also fall. This means we would see a movement along the demand curve to a lower quantity demanded. Consequently, the decrease in demand for MOP would result in a decrease in its price.

Given that there was no mention of changes in the number of producers or production costs for MOP, we can infer that the supply for MOP did not initially change. It was the demand for MOP that decreased first, which likely led to a subsequent decrease in the quantity supplied as producers responded to lower market demand.