Question

9. We observe that we have moved from one point on a supply curve to a higher point on a supply curve (up and to the right). From this we can conclude that supply has increased T OR F.

10. We observe that we have moved from one point on a supply curve to a higher point on a supply curve (up and to the right). This was caused by an increase in the price. T OR F

11. Price of X changes from $30 to $33 and the quantity supplied by producers of X does not change at all. From this we can determine that the supply curve (for this range of prices) is horizontal. T OR F

12. Changes in quantity supplied are caused by changes in ceterus paribus assumptions. T OR F

Answer 1

9.) The answer is False, because if we have moved from one point on the supply curve to another higher pint on the supply curve, this was caused by an increase in price.

10.) The answer is True, because if we have moved from one point on the supply curve to another higher pint on the supply curve, this was caused by an increase in price.

11.) The answer is False, as if quantity supplied does not change at all even after price increase, the the supply curve is vertical.

12.) The answer is False, changes in quantity supplied are caused by changes in price, while retaining the ceteris paribus assumption.