Question

What is the meaning of expansion and contraction in supply?

Answer 1

➡Expansion :- Refers to a movement along the supply curve in response to changes in price .

increase in supply refers to a downward to right shift in the supply curve resulting from favourable change in one of the shift factors .

➡ Contraction :- decrease in supply- an unfavourable change in one of the shift factors leads to an upward to left shift in supply curve .

Increase in supply :- it results in a downward movement along the supply curve.