Chapter 8- Supply

Question 1

Supply

Answer 1

Supply: The willingness and ability to sell a product

Question 2

Market Supply

Answer 2

Market Supply: total supply of a product

Question 3

Extension in Supply

Answer 3

Extension in Supply: rise in quantity supplied caused by a rise in the price of the product itself

Question 4

Contraction in Supply

Answer 4

Contraction in Supply: fall in quantity supplied caused by a fall in the price of the product itself

Question 5

Change in Supply

Answer 5

Change in Supply: changes in supply conditions causing shifts on the supply curves

Question 6

Decrease in Supply

Answer 6

Decrease in Supply: a fall in supply at any given price, causing the supply curve to shift to the left

Question 7

Increase in Supply

Answer 7

Increase in Supply: a rise in supply at any given price, causing the supply curve to shift to the right

Question 8

Unit Cost

Answer 8

Unit Cost: Average cost of production (total cost/ output)

Question 9

Improvements in Technology

Answer 9

Improvements in Technology: advances in the quality of capital goods and methods of production

Question 10

Direct Taxes

Answer 10

Direct Taxes: taxes on the income and wealth of individuals and firms

Question 11

Indirect Taxes

Answer 11

Indirect Taxes: taxes on goods and services

Question 12

Tax

Answer 12

Tax: payment to the government

Question 13

Subsidy

Answer 13

Subsidy: payment by a government to encourage the production for the consumption of a product

Question 14

Causes of Changes in Supply

Answer 14

Changes in Costs of Production (changes in price of any FOP and change in productivity)
Improvements in technomogy
Taxes
Subsidies
Weather Conditions
Health of livestock and crops
Wars
Discoveries and depletion of commodities( coal, gas, oil)
Prices of other products