Question

An increase in price will lead to an increase in quantity supplied. this statement is:_________

Answer 1

An increase in price will lead to an increase in quantity supplied. this statement is "the law of supply."

What is termed as the Law of Supply?

In economics, supply refers to the number of goods that a business or an individual offers to the market - that is, the amount that they produce at a given point in time.

For instance, if Apple produces 100 iPhones, this represents the supply decided to bring to the market.

Some key features regarding the Law of Supply are-

• According to the law of supply, as prices rise, businesses will supply greater quantities of the good to the market.
• A law of supply supposes that every other factors remain constant. In other words, when all other different factors remain constant, higher prices lead to higher supply.
• Changes in manufacturing costs, the amount of competitors, technology, as well as future price expectations are all factors that can impact supply.

Therefore, the law of supply portrays a positive relationship in between price of the product and the quantity supplied by market suppliers. As the price rises, suppliers would then tend to supply more in order to earn more revenue.

To know more about the Law of Supply, here

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