Question

If a factor input is increased and all other factor inputs remain the same, what happens to the quantity supplied of this good at each and every price?

a. it remains the same
c. it increases
b. it decreases
d. none of the above

Answer 1

The correct answer is letter b. it decreases. If a factor input is increased and all other factor inputs remain the same, the quantity of the supply of this good at each and every price i will decrease. The graph of demand and supply will shift to the left.