Question

Which factor probably caused the change shown in the graphs?

lifting of excise taxes



new technology for freezing food



government farm subsidies



An increase in the cost inputs



Just took the test and answered B. It was correct

Answer 1

new technology for freezing food

Step-by-step explanation:

Changes in technology shift the supply curve to the right. This is because the new technology lowers production costs, leading to increased supply without increasing price. In this case, the technology for freezing food has dislocated the supply curve, enabling higher meal production in 2008 at the same price level as 2007.

Answer 2

new technology for freezing food

Step-by-step explanation:

The graph shows a decline in demand for meals served between 2007 and 2008.

People can feed themselves in two ways, buying frozen food or buying food served at restaurants. In this way, we can say that these two forms of feeding are substitutive. If new technology allows frozen food to last longer, people can substitute meals served with frozen meals. This explains the decrease in demand for meals served, seen through the shift to the left of the demand curve on the chart, from 2007 to 2008.