Supply Theory

What is the law of supply?

• The law of supply states that as the price of a good or service increases, the quantity supplied by producers decreases.

• The law of supply states that as the price of a good or service increases, the quantity demanded by consumers also increases.

• The law of supply states that as the price of a good or service decreases, the quantity supplied by producers increases.

• The law of supply states that as the price of a good or service increases, the quantity supplied by producers also increases, ceteris paribus.

Explain the concept of supply curve.

• The supply curve shows the quantity of a good or service that producers are willing to supply at different prices.

• The supply curve shows the demand for a good or service

• The supply curve is not affected by price

• The supply curve is vertical

What factors can cause a shift in the supply curve?

• Global population growth

• Changes in consumer preferences

• Changes in production costs, technology, government policies, taxes, subsidies, and the number of suppliers.

• Weather conditions

How does technology impact supply?

• Technology complicates distribution channels

• Technology reduces production capabilities

• Technology hinders supply chain management

• Technology improves supply chain management, enhances production capabilities, and streamlines distribution channels.

What is the difference between individual and market supply?

• Individual supply is the quantity supplied by all producers in the market, whereas market supply is the total quantity supplied by one producer.

• Individual supply is the total quantity supplied by one producer, whereas market supply is the quantity supplied by all producers in the market.

• Individual supply is the quantity supplied by one producer, whereas market supply is the total quantity supplied by all producers in the market.

• Individual supply is the total quantity supplied by all producers in the market, whereas market supply is the quantity supplied by one producer.

How does government intervention affect supply?

• Government intervention always increases supply

• Government intervention has no impact on supply

• Government intervention can increase or decrease supply depending on the specific policy implemented.

• Government intervention only decreases supply

Discuss the role of expectations in supply theory.

• Producers always supply the same amount regardless of expectations

• Expectations have no impact on supply decisions

• Expectations only affect demand, not supply

• Expectations influence producers' decisions on how much to supply based on anticipated future prices.

The shift in the supply curve from S⁰ to S¹ shows; _______________.

• an increase in supply.

• a decrease in supply.

• an expansion in supply.

• a contraction in supply.

A movement along supply a supply curve can be influenced by _______________.

• price of the goods.

• level of technology.

• production costs.

• speculation.

More sellers enter the "Pizza" market. What happens to the total number of pizzas supplied?

• they decrease (curve shifts left)
• they increase (curve shifts right)
• they stay the same (the curve stays)