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Unformatted text preview: : The supply curve would shift left. Tornadoes destroy corn. 4. An Arizona student claims to have spotted a UFO over the desert outside of Tucson. How will his claim affect the supply (not the quantity supplied) of binoculars in Tucson stores? Answer : The demand for binoculars might increase, leading to an increase in the quantity of binoculars supplied, but no change in the supply of binoculars should occur. The UFO sighting does nothing to change the factors that govern the supply of binoculars. 5. What will happen to the equilibrium price and quantity of oranges if the wage paid to orange pickers rises? Answer : An increase in the cost of an input used in orange production will shift the supply curve of oranges to the left, resulting in an increase in the equilibrium price and a decline in the equilibrium quantity of oranges....
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- Spring '08