Question

the law of supply and demand
assignment active
factors affecting supply
consider this scenario:
during the early 2000s, the midwestern united states experienced a drought, or lack of rainfall

• this ruined large amounts of the corn crop.
• tortillas, which are made from corn, became more expensive to make.

what would tortilla manufacturers have needed to do in order to make the same profit?

• increase the price of tortillas
• decrease the price of tortillas
• decrease the supply of tortillas and keep the price the same
• decrease the supply of tortillas and decrease the price

Explanation:

The drought ruined corn crops, increasing tortilla production costs. To maintain profit, manufacturers need to cover higher costs. Increasing the price of tortillas (while supply may adjust) allows them to earn the same profit per unit despite higher production costs. Decreasing price or supply in ways that don't account for cost increases would reduce profit.

Answer:

A. increase the price of tortillas