Question

If sellers expect higher basket prices in the near future a) supply of baskets will increase. b) supply of baskets will decrease. c) supply of baskets will be unaffected. d) demand for baskets will decrease.

Answer 1

Answer:

Supply of basket decrease

Explanation:

If seller expect higher basket prices in the near future then the supply of basket decrease.

Supply is that quantity which any seller wants to send in the market .

There are various factor which effect the supply are :

• Government policy

• Expectation

• Taste of customers

• Technology

• Tax and subsidies
• number of seller in the market

As in question , as it is said that if seller expect higher basket prices in the near future then no doubt the supply will decreased it is because of reason  that demand of goods is increased .

Decrease in supply shift the supply curve towards left and disturbe the equilibrium. Decrease in supply cause the shortage of goods which automatically increase the price.