chapter 9

Question 1

law of supply

Answer 1

the direct relation between price and quantity supplied, keeping other factors constant

Question 2

reasons of law of supply

Answer 2

1. profit motive
2. change in number of firms
3. change in stock

Question 3

exception to law of supply

Answer 3

1. future exception
2. agricultural goods
3. rare articles
4. developing countries

Question 4

assumptions to law of supply

Answer 4

1. price of other goods is constant
2. no change in state of technology
3. prices of factor of production remains same
4. no change in taxation policy
5. goals of producer remain same