A student named Lee analyzes a drought's effect on the wheat market. Lee's first step is that the drought shifts the supply curve left, raising equilibrium price and lowering equilibrium quantity. Lee then argues that the higher price shifts the supply curve right again, and also shifts the demand curve left. Which part of Lee's reasoning is correct, and which part is the mistake?

1. The drought is a natural condition that raises production costs, which correctly shifts the supply curve of wheat to the left. 2. That shift correctly raises equilibrium price and lowers equilibrium quantity. 3. But the price change that follows is itself only a movement along the demand and supply curves, not a new shift. 4. A higher or lower price never shifts the supply curve or the demand curve for that same good. 5. So Lee's later steps mix up quantity supplied and quantity demanded with genuine shifts in supply and demand. 6. Option C is wrong because Lee's first step, the drought shifting supply left, is the one part that is correct. _Source: OpenStax Principles of Macroeconomics for AP Courses (CC BY 4.0), Ch 3 "Demand and Supply", section 3.2 | Shifts in Demand and Supply for Goods and Services_