Given a supply curve for ultrasound clinics, predict how the supply curve will shift (i

A. Due to the reduction in the cost of the ultrasound machine, the profit margins on the ultrasounds increases. Therefore, it would raise the supply of the ultrasound clinics and will let the supply curve shifted to rightward.

b. Since the increase in the wages of the clinic?s support staff, the average cost of the ultrasounds increase. Therefore, profit margins will fall which enables the decrease in the supply of the ultrasounds. Thus, the supply curve will get shifted towards the left.

c. On the arrival of new ultrasound equipment, less time will be taken which would raise the attended patients and will reduce the fixed cost of the firm. As the profit margins will rise, which in turn, raises the supply. Therefore, the supply curve would get shifted towards right.

d. An increase in the local utility rates would increase the cost of operating ultrasound machines. As a result, the profit margins will fall which would further reduce the supply and the supply curve would get shifted towards right.