Question

Which of the following is an implication of the law of​ supply?
A. Changes in the price of a good leads to a shift in the supply curve.
B. Individuals will purchase fewer units at a higher price and more units at a lower price.
C. Producers will offer more units at a higher price and fewer units at a lower price.
D. Increases in money prices will lead to an increase in supply while increases in relative prices will lead to a decrease in supply.

Answer 1

Answer:

The correct answer is option C.

Explanation:

The law of supply states that other things being constant, there is a positive relationship between quantity supplied and price of a product. This means that the price of a product and its quantity supplied change in the same direction.  

At a higher price, the quantity supplied will be more and vice versa. That is why the supply curve is upward sloping.