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Flashcards by eleanor.adamandi, updated more than 1 year ago
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| Question | Answer |
| Define supply | The total quantity made available at any given price over a specific time period |
| What is the law of supply? | As prices rise, so too does supply |
| What is the shape of the supply curve? | Upward sloping from left to right |
| Why does it slope upwards from left to right? | Because of the positive relationship between price and quantity supplied |
| What is the supply function? | S(x) = F[ P(x), POG, C, Tn] |
| What does P(x) and POG stand for? | P(x) = Price of Base Good POG = Price of Other Goods |
| What are "Other Goods" when talking about supply? | Alternative products the producer could supply |
| What does C stand for? | Cost of production |
| Is the relationship between cost of production and supply positive or negative? | Negative |
| What does Tn stand for? | Technology |
| What shape is the fixed supply curve? | Vertical |
| Give an example of a "product" with a minimum price | Labour (minimum wage) |
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