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Question
Microeconomics
Posted 7 months ago
According to the law of supply, what happens when the price of a good increases?
Choose 1 answer:
(A) The supply curve shifts to the left.
(B) The supply curve flattens out.
(c) The quantity supplied increases.
(D) The supply curve shifts to the right.
() People are willing to buy what is supplied.
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Answer from Sia
Verified answerPosted 7 months ago
Solution
a
Law of Supply: The law of supply states that, all else being equal, an increase in the price of a good will result in an increase in the quantity supplied
b
Quantity Supplied: When the price of a good increases, producers are willing to supply more of that good to the market. This is represented as a movement along the supply curve, not a shift of the supply curve
Answer
(C) The quantity supplied increases.
Key Concept
Law of Supply
Explanation
According to the law of supply, an increase in the price of a good leads to an increase in the quantity supplied, which is represented as a movement along the supply curve rather than a shift of the curve.
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