Ch. 5: Supply

Which of the following is an example of the law of supply in action?

• A farmer maintains the same level of apple production regardless of price changes.
• A farmer reduces apple production when prices rise.
• A farmer increases apple production when prices rise.
• A farmer increases apple production when demand decreases.

Which of the following is an example of a supply curve?

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Which of the following is a supply schedule?

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Draw a graph that shows a decrease in quantity supply for Big Macs.

Which of the following will cause an increase in quantity supply for Coke?

• An increase in production costs for Coke.
• A decrease in the price of Coke.
• An increase in the price of Coke.
• A decrease in the price of Pepsi

What causes a movement along the supply curve?

• A change in the cost of production

• A change in the number of suppliers

• A change in technology

• A change in the price of the product

Match the terms with the correct definitions.

• Supply

• Amount offered for sale changes due to a change in price

• Law of Supply

• Amount offered for sale at every price changes which causes the supply curve to shift

• Change in Supply

• Desire and ability to sell a product

• Change in Quantity Supply

• As price increases the amount offered for sale increases

Draw a graph showing a decrease in supply. (Make sure to label!)

What would be an example of a shift in the supply curve to the left?

• A decrease in the price of raw materials

• An increase in the number of producers

• A natural disaster that destroys part of the production capacity

• A technological advancement that makes production more efficient

Which of the following would most likely cause the supply of oranges to decrease?

• A major storm damages large portions of the orange crop

• A new fertilizer is developed that boosts orange production

• The price of oranges decreases

• Farm land becomes cheaper