Question

1. What is the relationship between price and supply of commodity ?
(A) Opposite (B) Direct (C) Equal (D) Zero
2. If there is expectation about rise in price in future then present supply…
(A) Decreases (B) Increases
(C) Remain constant (D) Become zero

Answer 1

Answer:

a)opposite maybe this one

Answer 2

The questions have been asked from the topic supply and elasticity of supply.

• The correct answers are -

1. The relationship between price and supply of commodity is Direct.

Being uniform towards all other variables, there is a direct relationship between the commodity price and quantity provided;

2. If there is expectation about rise in price in future then present supply Increases

Sellers have assumptions about the future price of a commodity, presumed to be constant when a supply curve is established. If distributors expect a higher price, then supply falls. If distributors expect a lower price, then supply rises.