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#cfa #cfa-level-1 #economics #microeconomics #reading-13-demand-and-supply-analysis-introduction #study-session-4
a change in the (own) price of a product causes a change in the quantity of that good willingly supplied. A rise in price typically results in a greater quantity supplied, and a lower price results in a lower quantity supplied. Hence, the supply curve has a positive slope, in contrast to the negative slope of a demand curve. This positive relationship is often referred to as the law of supply .
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3.3. The Supply Function and the Supply Curve
ek. The increase in price has enticed the seller to supply a greater quantity of gasoline per week than at the lower price. 3.4. Changes in Supply vs. Movements along the Supply Curve As we saw earlier, <span>a change in the (own) price of a product causes a change in the quantity of that good willingly supplied. A rise in price typically results in a greater quantity supplied, and a lower price results in a lower quantity supplied. Hence, the supply curve has a positive slope, in contrast to the negative slope of a demand curve. This positive relationship is often referred to as the law of supply . What happens when a variable other than own-price takes on different values? We could answer this question in our example by assuming a different value for wage rate, say,


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