Chapter-8 Flashcards
Supply (15 cards)
What is supply?
Supply is the willingness and ability to sell a product.
What is market supply?
Market supply is the total supply for a product.
What is the extension in supply?
An extension in supply arises when there is a rise in quantity supplied caused by an increase in the price of the product itself.
What is contraction in supply?
A contraction in supply arises when there is a fall in quantity supplied caused by an fall in the price of the product itself.
What are changes in supply?
Changes in suppply are conditions causing shifts in the supply curve.
What is increase in supply?
An increase in supply is the rise in supply at any given price, causing the supply curve to shift to the right.
What is decease is supply?
An decrease in supply is the fall in supply at any given price, causing the supply curve to shift to the left.
What is unit cost?
Unit cost is the average cost of production. It is found by dividing total cost by output.
What are the causes of changes of supply?
1) Changes in the cost production
2) Improvements in technology
3) Taxes
4) Subsidies
5) Weather conditions and health of livestock and crops
6) Prices of other products
7) Disasters and wars
8) Discoveries and depletion commodities
What are the reasons for a change in cost of production?
1) A change in the price of any of the factors of production
2) A change in their productivity
What are improvements in technology?
Improvements in technology are advances in the quality of capital goods and methods of production.
What are direct taxes?
Direct taxes are taxes on the income and wealth of individuals.
What are indirect taxes?
Indirect taxes are taxes on goods and services.
What is tax?
Tax is a payment to the government.
What is subsidy?
Subsidy is a payment by a government to encourage production or consumption of a product.
