In the land of Giorgio, demand for hair spray is so steep, it is said to be effectively vertical. If the market for hair spray has a standard upward sloping supply curve, and a vertical demand curve, how will an 20% increase in the cost of raw materials used to make hair spray impact the market for hair spray in the land of Giorgio? Price is expected to ____ and Quantity sold is expected to _____. (Graphing may help).
Select one:
a. increase; increase
b. increase; remain unchanged
c. remain unchanged; decrease
d. remain unchanged; increase
e. decrease; increase