1.2.2 supply

Question 1

supply

Answer 1

the quantity of a good/service that a product is willing + able to supply onto the market at a given price in a given time period

Question 2

causes of changes in supply (4)

Answer 2

• cost of production
• external shocks
• new tech
• taxation + subsidies

Question 3

subsidies

Answer 3

any form of government support (financial or otherwise) - offered to producers + occasionally consumers (eg solar pannels, apprenticeships, childcare)

Question 4

basic law of supply

Answer 4

as the price of a product rises, businesses expand supply to the market

Question 5

law of supply

Answer 5

• firms want to max profit + gain an increase in price for their product
• increases incentives for them to produce more

Question 6

supply curve

Answer 6

• rise in market bringd about an expansions of supply
• movement is caused soley by price

Question 7

outward shift (supply curve)

Answer 7

more/less will be supplied to the market at each level price

Question 8

inward shift (supply curve)

Answer 8

fall in supply means less is supplied to the market at each given price

Question 9

low unit costs (supply curve)

Answer 9

businesses can supply more at each price
(eg through higher productivity)

Question 10

high unit costs (supply curve)

Answer 10

causes an inward shift of supply
(eg rise in wages, rise in energy prices)