Economics JAMB

What effect would a change in price of a commodity have on its supply?

A. An increase in supply
B. No change in supply
C. A decrease in supply
D. A change in the quantity supplied

Correct Answer:

Option D – A change in the quantity supplied

Explanation

A change in the price of a good or service, holding all else constant, will result in a movement along the supply curve. A change in the cost of input will impact the cost of producing a good and will result in a shift in supply; supply will shift outward if costs decrease and will shift inward if they increase.

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