A fall in the price of a good causes producers to reduce the quantity of the good they are willing to produce. This fact illustrates

Question

Quizplus · Accepted Answer

The fact that a fall in price leads to a reduction in the quantity of a good producers are willing to produce is a demonstration of the law of supply. According to this law, all other factors being equal, the quantity of a good supplied by producers will increase as the price of the good increases, and will decrease as the price of the good falls.

A Fall in the Price of a Good Causes Producers