Suppose you are a producer of friendship bracelets. How would the following events affect your/the market's willingness and ability supply friendships bracelets? Match the event on the left to the proper determinant on the right.
1. The price of friendship bracelets decreases.
2. The school requires you to put a warning label on each bracelet. (may lose blood circulation)
3. The cost of labor to produce bracelets decreases.
4. Many more students decide to sell friendship bracelets.
5. You improve the education of your workers and they make more bracelets in the same time as before.
a. This is a change in costs due to government intervention.
b. This is a change in cost of inputs.
c. This does not affect supply.
d. This is a change in the number of suppliers.
e. This is a change in the quality of inputs.
1. c
2. e
3. b
4. d
5. a
To determine the effects of these events on the willingness and ability to supply friendship bracelets, we need to match the events with the appropriate determinants of supply. Let's go through each event and find the matching determinant:
1. The price of friendship bracelets decreases.
The price of the product itself does not directly affect the supply. It is the result of changes in supply and demand. Therefore, this event does not affect supply. The correct match is option c: This does not affect supply.
2. The school requires you to put a warning label on each bracelet. (may lose blood circulation)
If the school requires a warning label, it could be considered a change in the quality of inputs. The warning label is an additional input or requirement that affects the product. Therefore, the correct match is option e: This is a change in the quality of inputs.
3. The cost of labor to produce bracelets decreases.
A decrease in the cost of labor directly affects the production costs of the product. This change represents a change in the cost of inputs. Therefore, the correct match is option b: This is a change in the cost of inputs.
4. Many more students decide to sell friendship bracelets.
An increase in the number of suppliers indicates that there are more producers offering friendship bracelets in the market. This change represents a change in the number of suppliers. Therefore, the correct match is option d: This is a change in the number of suppliers.
5. You improve the education of your workers, and they make more bracelets in the same time as before.
Improving the education of workers enables them to become more productive in the same amount of time. This change indicates an increase in productivity or efficiency, which affects the production costs and the supply. Therefore, the correct match is option a: This is a change in costs due to government intervention.
So, the matching is as follows:
1. The price of friendship bracelets decreases. - c
2. The school requires you to put a warning label on each bracelet. (may lose blood circulation) - e
3. The cost of labor to produce bracelets decreases. - b
4. Many more students decide to sell friendship bracelets. - d
5. You improve the education of your workers and they make more bracelets in the same time as before. - a