The supply curve slopes up and to the right because:

Question

Quizplus · Accepted Answer

The law of increasing opportunity costs states that as the production of a good increases, the opportunity cost of producing an additional unit of that good increases as well. Therefore, producers must charge more to cover the increasing opportunity cost, resulting in an upward-sloping supply curve. Choices A and B are incorrect because there is no assumption about people buying more if a higher price is charged. Choice D is incorrect because the supply curve never slopes downward.

The Supply Curve Slopes Up and to the Right Because