Economics (AS & A Level) · Feb / March 2021 · Paper 12 · Question 9

A manufacturer reduces the price of its goods after developing a more efficient manufacturing process. It makes leather belts that compete against belts made of artificial material. What are the likely outcomes of the change in the manufacturing process?

1. Asupply of leather belts decreases; price of artificial belts decreases
2. Bsupply of leather belts decreases; price of artificial belts increases
3. Csupply of leather belts increases; price of artificial belts decreases
4. Dsupply of leather belts increases; price of artificial belts increases

As printed in the paper