Question 2.1: To draw the supply curve, the cost of inputs to production must be held constant. If the market price of oil declines, which of the following statements are true? Select all correct answers.

a. The ceteris paribus assumption is violated.

b. The supply curve will move to a different place.

c. The quantity of gasoline supplied at each price will change.

d. The supply curve will become downward sloping.

Question

Uriah Lane

Mathematics

5 December, 22:56

Question 2.1: To draw the supply curve, the cost of inputs to production must be held constant. If the market price of oil declines, which of the following statements are true? Select all correct answers.

a. The ceteris paribus assumption is violated.

b. The supply curve will move to a different place.

c. The quantity of gasoline supplied at each price will change.

d. The supply curve will become downward sloping.

+4

Answers (1)

Know the Answer?

Ben Hampton · Answer 1

Option c. The quantity of gasoline supplied at each price will change.

Step-by-step explanation:

There is a close correlation between the demand and supply. In simple terms, the demand increases inversely to the supply. This causes the price of the goods and commodities to shift. The precise term is inflation - the increase in the price of goods due to the decrease in the supply and increase in demand.