U3L2a HW Econ: Supply

The law of supply states that, all else being equal, an increase in price results in an increase in what?

• Demand

• Supply

• Equilibrium

• Cost

Differentiate between a change in quantity supplied and a change in supply.

• A change in quantity supplied refers to a movement along the supply curve due to a change in price, while a change in supply refers to a shift of the entire supply curve due to factors other than price.

• A change in quantity supplied refers to a shift of the entire supply curve due to factors other than price, while a change in supply refers to a movement along the supply curve due to a change in price.

• Both a change in quantity supplied and a change in supply refer to a movement along the supply curve due to a change in price.

• Both a change in quantity supplied and a change in supply refer to a shift of the entire supply curve due to factors other than price.

Explain how producers respond to changes in the price of resources.

• Producers increase production when resource prices fall and decrease production when resource prices rise.

• Producers decrease production when resource prices fall and increase production when resource prices rise.

• Producers do not change production regardless of resource price changes.

• Producers always increase production regardless of resource price changes.

Define subsidy.

• A financial aid provided by the government to support a specific economic sector.

• A tax imposed by the government on imported goods.

• A regulation set by the government to control prices.

• A loan given by banks to small businesses.

Which of the following is one of the five shifters (determinants) of supply?

• Income of consumers

• Prices of related goods

• Tastes and preferences

• Price of the good itself

• Number of sellers

What influences the decisions of sellers? Choose the best answer

• Market trends

• Personal preferences

• Government regulations

• All of the above

What affects the ability of a business to produce? Choose the best answer

• Market demand

• Production technology

• Availability of resources

• All of the above

What is the definition of 'Supply'?

• The total amount of a product available for purchase at any specified price.

• The desire of consumers to purchase goods and services.

• The difference between the highest and lowest prices of a product.

• The cost of producing one additional unit of a product.

The Law of Supply states that, all else being equal, an increase in price results in an increase in what?

• Demand

• Supply

• Equilibrium

• Scarcity

You own a lawn mower and you are willing to mow lawns. How many lawns will you mow at the price of $50 per lawn mowed?

• 0 lawns

• 1 lawn

• 2 lawns

• 3 lawns