Shifts In Supply Flashcards
1
Q
Factors affecting supply??
A
- Market price of product
- availability of factors of production
- cost of factors of production
- technology
- taxes
- red tape
2
Q
How does a change in costs affect the supply curve??
A
If costs increase, the market will produce less at any given price, and the supply curve will shift to the left
3
Q
How does business tax affect supply??
A
More VAT increases the costs for producers, it does not affect demand but the price rises because businesses try to pass it off to customers
