AP Macroeconomics / Unit 1: Basic Economic Concepts
1.5 Supply
Notes
Law of supply: as price rises, quantity supplied rises.
- Shifters: input prices, technology, taxes and subsidies, expectations, number of sellers, prices of other goods.
Practice
Better technology causes supply to:
Lower costs.
A rise in the cost of an input causes supply to:
Higher costs.
A higher price for a good leads to:
Movement along.
Ready for more? Take the Unit 1 test.