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Many products, such as golf clubs, are made with graphite-epoxy resins because it's strong and lightweight. If a new technology reduced the cost of producing graphite-epoxy, then you'd expect ____ in the graphite-epoxy golf club market.A.supply to decreaseB.supply to increaseC.demand to decreaseD.demand to increaseE.both supply and demand to increase

Question

Many products, such as golf clubs, are made with graphite-epoxy resins because it's strong and lightweight. If a new technology reduced the cost of producing graphite-epoxy, then you'd expect ____ in the graphite-epoxy golf club market.A.supply to decreaseB.supply to increaseC.demand to decreaseD.demand to increaseE.both supply and demand to increase

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Solution

The answer is B. supply to increase.

Here's the step by step explanation:

  1. The cost of producing graphite-epoxy resins decreases due to a new technology.

  2. This means that manufacturers can now produce more graphite-epoxy golf clubs for the same cost, or the same number of golf clubs at a lower cost.

  3. As a result, manufacturers are likely to increase their production of graphite-epoxy golf clubs because it's now more profitable to do so.

  4. This increase in production is reflected in an increase in supply in the market.

  5. The demand for graphite-epoxy golf clubs is not directly affected by the cost of production, so we wouldn't expect it to increase or decrease based on this information alone.

This problem has been solved

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