SOLVED:Why Does A Supply Curve Slope Upward? - Numerade

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Question

Why does a supply curve slope upward? Why does a supply curve slope upward? Economics: Concepts and Choices Holt Mcdougal 1st Edition Chapter 5, Problem 2 View All Chapters

Step 1

A supply curve is a graphical representation of the relationship between the price of a good or service and the quantity of that good or service that a seller is willing and able to supply. Show more…

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Key Concepts

Law of Supply This principle states that, all else being equal, an increase in the price of a good or service typically results in an increase in the quantity supplied by producers. It reflects the idea that higher prices make production more profitable, thereby incentivizing producers to supply more of the product in the market. Marginal Cost of Production As production expands, the cost of producing each additional unit often rises due to factors such as limited resources or diminishing returns. This increasing marginal cost requires higher prices to justify the production of extra units, contributing to the upward slope of the supply curve.

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Transcript

00:01 Hello, in this video we're going to talk about the supply curve and why it is upward sloping. 00:08 So let me draw a supply curve for you. 00:23 And the blue line is going to be the supply curve. 00:35 So why is the supply curve upward sloping? it is upward sloping because as price increases, the quantity supply increases. 00:47 And as price decreases, the quantity supply increases... Need help? Use Ace Ace is your personal tutor. It breaks down any question with clear steps so you can learn. Start Using Ace Ace is your personal tutor for learning Step-by-step explanations Instant summaries Summarize YouTube videos Understand textbook images or PDFs Study tools like quizzes and flashcards Listen to your notes as a podcast

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