Question

A change in the price of a good ______.

Options

• shifts the good's supply curve but does not cause a movement along it.

• does not shift the good's supply curve but causes a movement along it.

• shifts the good's supply curve and also causes a movement along it.

• neither shifts the good's supply curve nor causes a movement along it.

Answer 1

A change in the price of a good does not shift the good's supply curve but causes a movement along it.

Explanation:

• A change in the price of a good causes a movement along the supply curve, not a shift in the supply curve. This movement represents a change in the quantity supplied due to a price change, assuming all other factors remain constant.
• A shift in the supply curve occurs due to changes in other factors such as production costs, technology, or the number of suppliers, not due to a change in the price of the good itself.