A supply curve shows quantities supplied at various prices.It also shows the
A) total profit the firm earns at a given level of output.
B) marginal benefit of the good.
C) total cost of production.
D) marginal cost of production.
E) producer surplus, which is equal to the slope of the supply curve.

Question

Quizplus · Accepted Answer

A supply curve shows the relationship between the quantity supplied and the price of a good or service, but does not provide information on total profit, marginal benefit, or producer surplus. However, it does reflect the cost of production, which can be seen as the marginal cost of production at each level of output. Therefore, the best choice is D, which states that a supply curve shows the marginal cost of production.

A Supply Curve Shows Quantities Supplied at Various Prices