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Given a normal market supply curve for bicycles, if the price of bicycle seats increased, then there is a/an

decrease in supply for bicycles.
decrease in quantity supplied of bicycles.
increase in demand for bicycles.

2 Answers

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Answer:

decrease in supply for bicycles

Step-by-step explanation:

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User LeoE
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Answer: decrease in quantity supplied of bicycles.

A market supply curve is the summation of individual firms' supply curves and its important principle is that the market has to be perfectly competitive.

This means that there is a number of firms producing the same product in the market and there is no one who can manipulate prices. We can understand the market supply curve by first understanding a supply curve.

Given a normal market supply curve for bicycles, it shows the quantity of the product a firm is willing to produce for a given price of the bicycles. The curve is always upward sloping, showing a positive relationship between the price and quantity produced by the firm. This means that If the price of bicycle increased, then a firm will start producing more of that product. However, it is the bicycle “seats” (input cost) that increased in price, so the tendency is lower production and decrease in quantity supplied of bicycles.

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