3.1.2.3 The determinants of the supply NOTES

What directly affects the supply due to the cost of inputs like raw materials, labour, and energy?

• Demand curve

• Consumer preference

• Price elasticity

• Supply

How do technological advances affect the supply of goods?

• Decrease efficiency

• Reduce cost per unit

• Increase production costs

• Limit production capacity

What happens to the supply when the number of suppliers increases?

• Supply decreases

• Supply remains constant

• Market becomes monopolistic

• Supply increases

Which government policy can increase the supply of a good?

• Heavy regulation

• Increased taxes

• Subsidies

• Trade barriers

What is the typical shape of a supply curve?

• Upward sloping

• Vertical line

• Horizontal line

• Downward sloping

What causes a rightward shift in the supply curve?

• Increase in production costs

• Restrictive government policies

• Improvement in technology

• Adverse natural events

What might producers do if they expect prices to rise in the future?

• Decrease current supply

• Increase current supply

• Maintain current supply levels

• Exit the market

How does an increase in taxes on production inputs affect the supply curve?

• Shifts it to the right

• Shifts it to the left

• Makes it more elastic

• No effect on the supply curve

What effect does a subsidy on technology for manufacturers have on the supply of their products?

• Decreases supply

• Increases supply

• Supply remains constant

• Supply becomes unpredictable

What happens to the supply curve when there is a decrease in the number of producers?

• It shifts to the right

• It becomes steeper

• It shifts to the left

• It becomes perfectly elastic