Final answer:
Supply curves typically slope upward because higher prices incentivize individual businesses to increase production, and draw more producers into the market. This principle is encapsulated in the law of supply, which is graphically represented by the upward-sloping supply curve intersecting with the demand curve to establish market equilibrium.
Step-by-step explanation:
Supply curves are typically upward-sloping, and the correct answer to the student's question is option (a): They slope upward because higher prices lead individual businesses to supply a larger quantity, and more businesses are willing to supply goods and services. This is due to the law of supply, which states that as the price of a good or service rises, the quantity supplied generally increases, and as the price falls, the quantity supplied generally decreases. For instance, if the price of gasoline increases from $1.00 per gallon to $2.20 per gallon, the quantity supplied might rise from 500 gallons to 720 gallons.
The supply curve is a graphical representation of this relationship between price and quantity supplied. It shows that producers are willing to supply more of a good or service at higher prices because it becomes more profitable for them. Additionally, at higher prices, it may attract new producers into the market who were previously unwilling or unable to produce at lower prices. This results in an upward slope from left to right on supply graphs. Together with the demand curve, these supply curve models help determine equilibrium prices and quantities in a market.