supply Flashcards
1
Q
what is supply?
A
supply is the willingness and ability of a firm to produce goods and services at a given price level
2
Q
what is the law of supply?
A
when supply increases price increases
3
Q
state all the nonprice factors of supply
A
time, weather, opportunity cost, taxes, innovation, production cost, and subsidies
4
Q
what causes movement along the supply curve?
A
changes in price
5
Q
what is an extension?
A
an increase in supply as a result of an increase in price
6
Q
what is a contraction?
A
a decrease in supply due to a decrease in price
7
Q
what are shifts in the supply curve?
A
a shift in the supply curve is an increase or decrease in supply due to non-price factors
