What is stated by the law of supply?
(1 point)
Responses
An increase in price will cause a reduced amount of sales.
An increase in quantity sold will allow a decrease in price.
An increase in quantity produced will decrease consumer demand.
An increase in price will inspire an increase in units supplied.
An increase in price will inspire an increase in units supplied.
The correct statement made by the law of supply is:
(1 point) An increase in price will inspire an increase in units supplied.
According to the law of supply, an increase in price will inspire an increase in units supplied. This means that as the price of a product or service goes up, producers and suppliers are incentivized to supply more of that product or service to the market. Conversely, a decrease in price will typically lead to a decrease in the quantity supplied.
To arrive at this answer, you need to understand the concept of the law of supply. The law of supply is a fundamental principle in economics that states that as the price of a good or service increases, the quantity supplied by producers will also increase, assuming all other factors remain constant. This is because higher prices often result in higher profit margins for producers, which motivates them to increase their production and supply more to the market.
By understanding this principle, you can recognize that an increase in price will inspire an increase in units supplied, which is stated in one of the given options. Therefore, the correct statement according to the law of supply is that "an increase in price will inspire an increase in units supplied."