Chapter 3, Problem 13P

To determine

Assume that the cost of aluminum used by soft drink companies increases. Which of the following correctly describes the resulting effects in the market for soft drinks distribute in aluminum cans? (More than one statement may be correct).

a) The demand for soft drinks decreases.

b) The quantity of soft drinks demanded decreases.

c) The supply of soft drinks decreases.

d) The quantity of soft drinks supplied decreases.

Content information:

In a goods market, the equilibrium occurs at the point where demand for goods is equal to its supply at a given price. The price which balances demand and supply is called the equilibrium price and the quantity is called the equilibrium quantity.