Mastering Supply: Quick Quiz for High School Economics

📚 Quick Study Guide

• 📈 Law of Supply: States that, all else being equal, as the price of a good or service increases, the quantity supplied will increase, and vice versa.
• 🏭 Factors Affecting Supply:
  • 💸 Cost of Production: Includes wages, raw materials, and other inputs. Higher costs decrease supply.
  • 🧪 Technology: Improvements in technology usually increase supply.
  • 🏛️ Government Policies: Taxes and subsidies can affect supply. Taxes decrease supply, while subsidies increase it.
  • 🌍 Number of Sellers: More sellers in the market increase supply.
  • 🔮 Expectations: Expectations about future prices can influence current supply decisions.
• 📏 Supply Curve: A graphical representation of the relationship between price and quantity supplied. It typically slopes upward.
• ➕ Change in Quantity Supplied: Movement along the supply curve due to a change in price.
• ➡️ Change in Supply: A shift of the entire supply curve due to changes in factors other than price.
• 💡 Formula: Understanding the basic formula for supply isn't about a single equation, but recognizing the relationship: Higher Price = Higher Quantity Supplied (generally).

Practice Quiz

1. Which of the following best describes the law of supply?
   1. An increase in price leads to a decrease in quantity supplied.
   2. An increase in price leads to an increase in quantity supplied.
   3. A decrease in price has no effect on quantity supplied.
   4. Price and quantity supplied are unrelated.
2. What is the primary effect of improved technology on supply?
   1. It decreases supply by making production more complex.
   2. It increases supply by lowering production costs.
   3. It has no effect on supply.
   4. It only affects the demand side of the market.
3. How do taxes typically affect supply?
   1. Taxes increase supply by providing more revenue to producers.
   2. Taxes decrease supply by increasing production costs.
   3. Taxes have no effect on supply.
   4. Taxes only affect consumers, not producers.
4. An increase in the number of sellers in a market will:
   1. Decrease the overall supply.
   2. Increase the overall supply.
   3. Have no effect on the overall supply.
   4. Only affect the price, not the quantity.
5. If producers expect the price of their product to increase significantly in the future, how might this affect their current supply?
   1. They will increase current supply to take advantage of higher prices later.
   2. They will decrease current supply to sell more at the higher future price.
   3. Their current supply will not be affected by future price expectations.
   4. They will stop production altogether.
6. Which of the following causes a movement *along* the supply curve?
   1. A change in the cost of raw materials.
   2. A change in technology.
   3. A change in the price of the good itself.
   4. A change in government regulations.
7. What does an upward-sloping supply curve indicate?
   1. As price increases, quantity supplied decreases.
   2. As price decreases, quantity supplied increases.
   3. As price increases, quantity supplied increases.
   4. Price has no effect on quantity supplied.