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Question
Price and Supply move in the same direction. Justify the statement.
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Solution
According to the law of supply, the quantity of a commodity supplied varies directly with its price, assuming all other parameters remain constant.
"The law of supply states that the higher the price, the greater the quantity supplied or lower the price, the smaller the quantity supplied."
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RELATED QUESTIONS
State with reason whether you agree or disagree with the following statement:
There is a direct relationship between price and quantity supplied.
What are the reasons for upward sloping supply curve?
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Assertion (A): Law of Supply is a qualitative statement.
Reason (R): Law of Supply indicates the magnitude of change in the quantity supplied.
Explain the law of supply.
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What does the Law of Supply state?
Which of these situations violates the "ceteris paribus" (other things being constant) condition for the Law of Supply?
Which factor is assumed to remain unchanged under the Law of Supply?
