What effect do higher prices of alternative goods have on supply?

Higher prices of alternative goods indicate that those alternatives are becoming more profitable for producers. When producers see that they can earn more by reallocating their resources to produce these alternative goods, they will, in fact, redirect some of their focus and resources away from the current goods they produce. This shift can lead to a decrease in the supply of the current goods in the market, as fewer resources are being dedicated to them. This reallocation is a natural response to changes in market conditions, where producers aim to maximize their profit by responding to price signals.

The other options do not accurately reflect the relationship between alternative goods and supply. Higher prices of alternatives do not lead to a decrease in overall market price; rather, they impact producer behavior. They cannot have no effect on supply given the economic principle that producers respond to price incentives. Lastly, while enhanced demand for current goods can occur, it would primarily be influenced by other factors, not directly due to the higher prices of alternative goods. The core concept here is the responsiveness of supply to price changes in alternatives, which supports the view that supply will be affected by a shift in focus towards more profitable production opportunities.