As the market price of a service increases, more potential sellers will decide to perform that service because:
A)higher prices result in higher revenue.
B)more potential sellers will find that the market price exceeds their reservation price.
C)it's more prestigious to produce high-priced services.
D)higher prices lead to lower opportunity costs.

Question

Quizplus · Accepted Answer

A seller will supply an additional unit of output if the market price is greater than or equal to the seller's opportunity cost of producing an additional unit. Thus, as the market price rises, sellers with higher opportunity costs will enter the market.

As the Market Price of a Service Increases, More Potential