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9 August, 14:15

True or False: The law of supply is a direct negative relationship between the price of a good or service and the quantity of it that producers are willing to supply. The height of the supply curve at any quantity shows the minimum price necessary to induce customers to purchase that unit.

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  1. 9 August, 16:34
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    False

    Explanation:

    Although the first part of the statement correctly describes the law of supply as an inverse relationship between the price of good/service and the quantity suppliers would supply (given a particular price), the second part is false.

    Height of the supply curve indicates a minimum price that would incentivize suppliers to start creating a particular good. The notion of customers and purchase is related to the demand curve, not supply.
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