3.3.3 The determinants of the supply of goods and services

• A higher price for a good typically leads to a higher quantity supplied.
• How does improved technology affect supply?

  Increases quantity supplied
• Government taxes reduce the quantity supplied.


  True
• Match the determinant of supply with its effect:

  Price of the good ↔️ Higher price increases supply

  Cost of production ↔️ Higher cost decreases supply

  Technology ↔️ Improved technology increases supply

  Number of suppliers ↔️ More suppliers increase supply

  Government policies ↔️ Subsidies increase supply, taxes decrease it
• A higher price of a good motivates producers to increase supply.


  True
• Government taxes on production lead to a lower quantity supplied.
• Why do higher prices motivate producers to increase supply?

  To maximize profits
• Technological advancements lead to greater supply at lower costs.
• What is the economic definition of supply?

  Quantity supplied at different prices
• Higher production costs result in a lower quantity supplied.


  True
• More suppliers in the market lead to a higher overall quantity supplied.
• What do the determinants of supply influence?

  Producers' willingness to sell
• Lower costs of production encourage a higher quantity supplied.
• How does improved technology affect the supply curve?

  Shifts it to the right
• Higher production costs increase supply.

  False
• Order the steps to differentiate between changes in supply and changes in quantity supplied:

  1️⃣ Understand the definitions of supply and quantity supplied

  2️⃣ Identify the causes of changes in each concept

  3️⃣ Distinguish between movements along and shifts of the supply curve

  4️⃣ Analyze the effects of price and non-price determinants