Which best describes what happens to the amount of a good or service that is supplied to consumers?
Which best describes what happens to the amount of a good or service that is supplied to consumers? The amount of a good or service can change. The amount of a good or service always remains the same. The amount of a service cannot change.
How does the law of supply say the factory will respond to the increase in the price of blue widgets?
The law of supply says that the factory will respond by producing more blue widgets. Under the current model, input costs aside, the factory stands to make $100 dollars a day if both blue and green widgets are priced at $5 a widget.
When a company produces goods for sale those goods must be?
Calculate the Price
| The graph shows a supply curve. Which change is illustrated by the shift taking place on this graph? | a decrease in supply |
|---|---|
| When a company produces goods for sale, those goods must be | created in ways that meet consumer demand. |
What happens when the price of a good increases the quantity of goods that are produced increases?
The law of supply is the microeconomic law that states that, all other factors being equal, as the price of a good or service increases, the quantity of goods or services that suppliers offer will increase, and vice versa.
What is the difference between increase in quantity demanded and increase in demand?
What is the difference between an “increase in demand” and an “increase in quantity demanded”? An “increase in demand” is represented by a rightward shift of the demand curve while an “increase in quantity demanded” is represented by a movement along a given demand curve.
How is an increase in demand represented?
Increases in demand are shown by a shift to the right in the demand curve. This could be caused by a number of factors, including a rise in income, a rise in the price of a substitute or a fall in the price of a complement.
What is an increase in demand?
An increase in demand means that consumers plan to purchase more of the good at each possible price. c. A decrease in demand is depicted as a leftward shift of the demand curve. d. A decrease in demand means that consumers plan to purchase less of the good at each possible price.
What happens if PED is negative?
The PED coefficient is usually negative, although economists often ignore the sign. Demand for a good is relatively inelastic if the PED coefficient is less than one (in absolute value). Demand for a good is relatively elastic if the PED coefficient is greater than one (in absolute value).
Is elasticity negative or positive?
Income elasticity of demand
| If the sign of Y E D YED YED is… | and the elasticity is | the goods are |
|---|---|---|
| negative | elastic or inelastic | inferior good |
| 0 | perfectly inelasatic | absolute necessity |
| positive | inelastic | normal necessity |
| positive | elastic | normal luxury |
What does a cross price elasticity of 0 mean?
Independent goods have a cross-price elasticity of zero: as the price of one good increases, the demand for the second good is unchanged.