The law of supply indicates that, other things equal,

Question

Quizplus · Accepted Answer

The law of supply states that as the price of a good or service increases, the quantity supplied will also increase, ceteris paribus. This is because at higher prices, producers can earn more profit, so they have an incentive to increase their production and offer more of the product. As such, option A is the correct answer. Option B is incorrect because the supply curve is actually upward sloping - as price increases, the quantity supplied also increases. Option C is incorrect because this describes the law of demand, not the law of supply. Option D is incorrect because, as mentioned earlier, producers offer more of a product at higher prices, not at lower prices.

The Law of Supply Indicates That, Other Things Equal