Am I right in stating the supply of candy would be greater, as it is now cheaper to produce due to sugar being cheaper. Therefore the price of candy could be lowered as there is a greater supply of candy, with cheaper candy increasing the demand for candy as it is now cheaper. How would I illustrate this starting from the equilibrium point?
If price of sugar goes up, which is a requirement for making candies, this would increase the cost of production, and thereby, reducing the supply. The new supply curve would be to the left of the original supply curve, and the demand would be unchanged. Result is a higher price, and a lower quantity.