8 Supply

Question 1

quantity of goods and services that the producer is willing and able to produce

Answer 1

supply

Question 2

“nothing else changes,” everything is constant

Answer 2

ceteris paribus

Question 3

↑ price ↑ supply; ↓ price ↓ supply

Answer 3

law of supply

Question 4

law that is directly proportional

Answer 4

law of supply

Question 5

law where price is the only factor

Answer 5

law of supply

Question 6

when price ↑ it becomes more profitable, so supply ↑; when price ↓ it becomes less profitable, so supply ↓

Answer 6

law of supply

Question 7

as more goods are made, price must ↑ to cover the cost of production

Answer 7

law of supply

Question 8

mathematical formula with Qs and P (quantity supplied and price)

Answer 8

supply function

Question 9

table showing change

Answer 9

supply table

Question 10

graph of Qs and P; always going up

Answer 10

supply curve

Question 11

along supply curve; change in price

Answer 11

movement

Question 12

of supply curve; change in non-price factors; if it moves to the right, it increases; if it moves to the left, it decreases

Answer 12

shift

Question 13

↑ price of input
↑ cost of production
↑ price of product
↓ supply
↓ demand

↓ price of input
↓ cost of production
↓ price of product
↑ supply
↑ demand

Answer 13

change in price inputs (inputs/factors of production)

Question 14

new technology (method, device, etc) is introduced, which makes things easier

Answer 14

change in level of technology

Question 15

increase in amount of physical capital available relative to labor to help firms increase output

Answer 15

capital deepening

Question 16

↓ cost
↑ profit
↑ supply

Answer 16

change in level of technology and capital deepening

Question 17

FUTURE: ↑ price
NOW: ↓ supply

FUTURE: ↓ price
NOW: ↑ supply

Answer 17

change in expectations (of future prices)

Question 18

the gov’t can tax, subsidize, or regulate production; it can encourage production of specific goods and services (↓ taxes and give subsidies; ↑ taxes and put limits)

Answer 18

gov’t policies

Question 19

↑ or ↓ in number of producers in the market affects level of supply of goods and services

Answer 19

change in number of firms

Question 20

pertains to producer’s sensitivity to changes in price on quantity willing to produce

Answer 20

price elasticity of supply

Question 21

> 1

Answer 21

elastic

Question 22

< 1

Answer 22

inelastic

Question 23

= 1

Answer 23

unitary

Question 24

elastic = what run?

Answer 24

long run

Question 25

inelastic = what run?

Answer 25

short run