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Homework answers / question archive / Which of the factors below does NOT affect the supply of shoes? a
Which of the factors below does NOT affect the supply of shoes?
a. A change in the price of shoes.
b. A change in the cost of leather.
c. A government tax or subsidy on shoe production.
d. Lower costs of shoe-making equipment.
Option A (A change in the price of shoes) is the correct answer.
The change in the price level will change the quantity supplied of the shoes, but there will be no shift in the supply curve. It will cause an upward or downward movement on the same supply curve. As the graph shows the relationship between the price level and the quantity supplied.
When there is a change in the cost of leather which is an input good for the production of shoes, it will either shift the supply curve leftward or rightward accordingly. When the government put a tax on the production it becomes expensive for the producer to produce and shifts the supply curve leftwards and when provides a subsidy, the supply curve shifts rightward because it is now cheaper to produce the shoes. When the cost of shoemaking equipment gets reduced it will which the supply curve to the right, as the cost of production has reduced.