Question

the law of supply states that: *
a) as price increases, quantity demanded increases.
b) as price decreases, quantity supplied increases.
c) as price increases, quantity supplied increases.
d) as price decreases, quantity supplied remains unchanged.
you own a little caesars franchise. which of the following is an example of * 1 point
a fixed cost?
a) cheese
b) rent
c) labor
d) electricity
when a suppliers production costs rise, what will happen to the supply * 1 point
curve for their product?
a) the curve will shift to the right.
b) the curve will shift to the left.
c) the curve will become more elastic.
d) the curve will remain unchanged.

Explanation:

• First question: The law of supply states that there is a positive relationship between price and quantity supplied. As price increases, quantity supplied increases (c). Option a is about demand. Option b is incorrect as price decrease would lead to quantity supplied decrease. Option d is wrong as price change affects quantity supplied.
• Second question: Fixed costs do not change with the level of output. Rent (b) is a fixed cost. Cheese (a) is a variable cost (used more as production increases). Labor (c) can be variable (hiring more workers for more production). Electricity (d) can vary with production (more ovens on for more pizzas).
• Third question: When production costs rise, suppliers are less willing to supply at each price. The supply curve shifts to the left (b). A right - shift (a) would be for cost decrease. Elasticity (c) is about responsiveness to price change, not directly about cost - induced shifts. The curve does not remain unchanged (d) when costs change.

Answer:

c) As price increases, quantity supplied increases.
b) Rent
b) The curve will shift to the left.