Question

As the price of jeans rises, Levi Strauss is likely to A. decrease production and thus decrease the supply. B. increase production and thus increase the supply. C. do nothing to influence the available supply of jeans. D. increase production to influence the demand for jeans. E. discontinue producing jeans in favor of a different product.

Answer 1

Answer:

B. Increase production and thus increase the supply.

Explanation:

As the price of Jeans rises, the Levi Strauss is likely to increase production keeping other factors constant as per the law of supply, where quantity is directly proportional to the price of goods and services. As the price of goods increase, the quantity supply of product also increased by supplier or manufacturer to maximize the profit out of the current market condition.