Refer to the information provided in Figure 5.6 below to answer the question that follows. Figure 5.6Refer to Figure 5.6. The market is initially in equilibrium at Point A and supply shifts from S1 to S2. Which of the following statements is true?

A. There is no need for price to serve as a rationing device in this case because the new equilibrium quantity exceeds the original equilibrium quantity.
B. The market cannot move to a new equilibrium until there is also a change in demand.
C. Price will still serve as a rationing device causing quantity supplied to exceed 12 thousand pizzas.
D. Price will still serve as a rationing device causing quantity demanded to fall from 12 to 10 thousand pizzas.


Answer: D

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