Question

Because you understand the law of supply, you can deduce that the correct graphical representation of the supply for CDs must be_______. Moreover, you know that at a price of $10 per CD, the quantity supplied_______ is five million CDs.

Answer 1

Answer:

The answers are S1 where S1 is supply curve that has the potential to move to S2  and Quantity Supplied

Explanation:

Referring to the diagram below, an increase in supply occurs when the  supply curve shifts to the right as shown  in diagram below. The original demand and  supply curves equal D1 and S1,  respectively. Thus, the original  equilibrium equals E1, with a price and  quantity equal to P1 and Q1 respectively.  However, when the supply increases to  S2, the market moves to a new  equilibrium, E2, with equilibrium price  decreasing to P2 while equilibrium  quantity increases to Q2.

What is equilibrium: In economics as the may be, equilibrium is the circumstance in which market forces such as demand and supply are balanced. That is, there is an absence of external influences on the values of economic variables therefore making the process unchanged.

Answer 2

The law of supply states that keeping all the factors other than price of the product constant,  an increase in the price of a product will result in the supplier of that product supplying more of that product.

What does the graph explains?

The graph is showing us that how an increase in supply due to change in price results in a shift in supply curve from S1 to S2.

The new equilibrium is obtained at the point E2 where new demand and supply curve are intersecting each other. This is resulting in a decrease in price and an increase in Quantity which are represented by P2 and Q2 respectively.

Therefore , graphical representation of the supply for CDs must be S1 Moreover, you know that at a price of $10 per CD, the quantity supplied S2 is five million CDs.

Learn more about Law of supply here:

brainly.com/question/5022636