An increase in the price of a good would

Question

Quizplus · Accepted Answer

An increase in the price of a good would give producers an incentive to produce more because they can earn more profit from selling each unit. This is the basic law of supply which states that as the price of a good increases, the quantity supplied of the good also increases. Therefore, option A and B are incorrect. Option D is incorrect because an increase in the price of a good would not decrease the quantity supplied of the good.

An Increase in the Price of a Good Would