Answer :
The statement "When analyzing shifts in supply and demand, the shifter will determine changes in price and quantity" is FALSE.
Explanation:
1. **Role of Shifters**: In economics, shifts in supply and demand curves are influenced by various factors known as shifters. These shifters can affect the equilibrium price and quantity in a market.
2. **Supply Shifters**: Factors that can shift the supply curve include changes in input prices, technology, government regulations, and expectations of future prices. When the supply curve shifts, it leads to changes in both the price and quantity traded in the market.
3. **Demand Shifters**: Factors that can shift the demand curve include changes in consumer income, preferences, prices of related goods, population demographics, and consumer expectations. Similar to supply, when the demand curve shifts, it causes changes in both price and quantity in the market.
4. **Determining Changes**: While the shifters influence changes in price and quantity, it is important to note that the specific impact on price and quantity can vary. For instance, an increase in supply due to lower production costs might lead to a decrease in price and an increase in quantity traded.
5. **Conclusion**: Therefore, analyzing shifts in supply and demand involves understanding how various factors affect these curves and subsequently influence price and quantity outcomes in a market. It is not solely about determining changes in price and quantity, as the relationship is more nuanced and depends on the specific circumstances and the interplay of multiple factors.
In summary, analyzing shifts in supply and demand involves considering the impact of shifters on price and quantity, recognizing that changes in these factors are interconnected and influenced by a range of economic variables.
