Figure 3.8 -Refer to Figure 3.8. the Graph in This Figure Illustrates

Multiple Choice

Figure 3.8

-Refer to Figure 3.8. The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D₁ and S₁ (point A) . If there is an increase in the price of fertiliser used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks, how will the equilibrium point change?

A) The equilibrium point will move from A to B.
B) The equilibrium point will move from A to C.
C) There will be no change in the equilibrium point.
D) The equilibrium point will move from A to E.