1. Explain whether each of the following events represents (i) a shift of the supply curve or (ii) a movement along the supply curve.
More homeowners put their houses up for sale during a real estate boom that causes house prices to rise.
The quantity of houses supplied rises as a result of an increase in prices. This is a movement along the supply curve.
Many strawberry farmers open temporary roadside stands during harvest season, even though prices are usually low at that time.
The quantity of strawberries supplied is higher at any given price. This is a rightward shift of the supply curve.
Immediately after the school year begins, fast-food chains must raise wages, which represent the price of labor, to attract workers.
The quantity of labor supplied is lower at any given wage. This is a leftward shift of the supply curve compared to the supply curve during school vacation. So, in order to attract workers, fast-food chains have to offer higher wages.
Many construction workers temporarily move to areas that have suffered hurricane damage, lured by higher wages.
The quantity of labor supplied rises in response to a rise in wages. This is a movement along the supply curve.
Since new technologies have made it possible to build larger cruise ships (which are cheaper to run per passenger), Caribbean cruise lines offer more cabins, at lower prices, than before.
The quantity of cabins supplied is higher at any given price. This is a rightward shift of the supply curve.