Question

Which of the following does not cause shift of supply curve of a good?

Options

• Price of input

• Price of the good

• Goods and Services Tax

• Subsidy

Answer 1

Price of the good

Explanation:

• Price of the good does not cause a shift in the supply curve. Instead, it causes a movement along the supply curve. If the price of the good changes, the quantity supplied changes, but the supply curve does not shift.

• Factors that cause a shift in the supply curve include changes in the price of inputs, taxes like GST, subsidies, technology, and other external factors. These factors can increase or decrease the overall supply, shifting the supply curve to the right or left.