If the supply of a product increases, then Select one: a. more will be purchased at the same price b. the price of the product must have declined c. demand for the good must have increased d. producers are willing to accept a lower price for each unit sold e. producers offer less for sale at each possible price
Answers
This means more if a good is made available to the market.
Increase in supply can result from any of the following reasons:
i)increase in number of producers
ii)decrease in production costs
iii)advancement in technology
iv)expectation of favorable market conditions
v)decrease in tax ,and other government subsidies
The answer is A. more will be purchased at the same price.
Because an increase in supply will cause reduction in equilibrium price
and increase in equilibrium quantity of a good
"If the supply of a product increases, producers are willing to accept a lower price for each unit sold.
In the market, supply and demand plays a crucial rule. If the demand for the product is more, and supply is less, this will cause a hike in the "price of the product". "On the other hand", if the demand for the product is less and the supply is more automatically this will lead to the price fall of the product. If the "supply and demand" is both in equilibrium condition then the price of the product will also remain in an equilibrium condition.
In the scenario given in the question, as the supply of product increases, without the "increase in demand" this will lead to a condition of price fall and the producers will accept a "lower price" for each "unit sold"."