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All Cereal Producers Have Decided to Add a New Ingredient,the

Question 140

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All cereal producers have decided to add a new ingredient,the "crunch enhancer," to cereals.Crunch enhancer keeps cereals crisper longer in milk and,as a result,consumers decide they like cereal more than before.What happens to the supply and demand curves for cereal now that it costs more to produce and consumers like it better?


A) The supply and demand curves both shift rightward.
B) The supply curve shifts rightward and the demand curve remains unchanged.
C) The supply curve shifts leftward and the demand curve shifts rightward.
D) The supply curve shifts leftward and the demand curve remains unchanged.
E) Neither curve changes but a movement occurs up along the demand curve and a movement occurs up along the supply curve.

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