Supply rises as price increases as more willing and able to sell a good at a higher price. This describes which concept?

Supply rises as price increases as more willing and able to sell a good at a higher price. This describes which concept?

• A. Law of Supply
• B. Law of Demand
• C. Elasticity of Supply
• D. Utility

Answer: (A)

At play here is the Law of Supply: producers are willing to sell more of a good as its price rises. When prices go up, selling more becomes more profitable, so existing firms increase output, and higher prices can attract new firms into production. This creates an upward-sloping relationship between price and quantity supplied, all else equal. This differs from the Law of Demand, which says higher prices lead to fewer purchases by consumers. Elasticity of Supply focuses on how responsive the quantity supplied is to price changes, not the basic direction of the relationship. Utility is about the satisfaction or usefulness a consumer gets from a good, not about how much producers supply.

At play here is the Law of Supply: producers are willing to sell more of a good as its price rises. When prices go up, selling more becomes more profitable, so existing firms increase output, and higher prices can attract new firms into production. This creates an upward-sloping relationship between price and quantity supplied, all else equal.

This differs from the Law of Demand, which says higher prices lead to fewer purchases by consumers. Elasticity of Supply focuses on how responsive the quantity supplied is to price changes, not the basic direction of the relationship. Utility is about the satisfaction or usefulness a consumer gets from a good, not about how much producers supply.