Law of Supply and Factors that Change Supply Review

At the first football game of the year, the concession stand sold out of nachos by halftime. What was higher, the supply or demand?

• Supply

• Demand

Supply is

• how much consumers are willing to buy.

• how much a producer (a business) is able and willing to make for sale to consumers.

• the goods that are left over after a sale.

• All of the above.

The law of supply says

• a producer (a business) will supply less as prices of a good increases.

• a producer will supply more as prices of a good decrease.

• a producer will supply more as prices of a good increase.

• None of the above.

For businesses, profit serves as

• a discouragement to supply more of a likely good.

• an incentive to supply more of a good.

• an encouragement to give products away for free.

• None of the above.

Beside price, what is one of the most important factors that can affect supply?

• The cost of production

• Advertisements

• Weather

• None of the above

The diagram represents a(n)

• increase in supply

• decrease in supply

• change in quantity supplied

• none of the above

When the cost of production increases for a good, it will lead to an

• increase in supply.

• increase in profit.

• decrease in supply.

• none of the above.

If the government imposes a tax on a business, the business will most likely

• increase supply.

• refuse to pay the tax.

• decrease supply.

• do nothing with supply.

If the government provides a subsidy (a grant/free money) to a business, it will most likely

• increase supply.

• refuse the subsidy.

• decrease supply.

• do nothing with supply.

An increase in competition, will lead to a

• a decrease in supply.

• an increase in supply

• no change in supply

• All of the above.