Final answer:
True. The quantity supplied of a good or service is correctly described as the amount that sellers are willing and able to sell at a particular price, in line with the law of supply.
Step-by-step explanation:
The statement 'The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price' is indeed accurate. This concept is rooted in the law of supply, which posits a direct relationship between price and the quantity of a good or service that producers are willing to supply. As prices increase, the quantity supplied typically increases, and as prices fall, the quantity supplied typically decreases. This is because higher prices can lead to higher potential profits, incentivizing producers to supply more of their goods or services. Conversely, lower prices may decrease the incentive to produce, leading to a decrease in quantity supplied.
For example, consider the supply of gasoline. When the price of gasoline rises, it motivates profit-seeking firms to take actions such as expanding oil exploration or investing in refineries. This response to price changes reflects the positive relationship between price and quantity supplied, a foundational element of supply behavior in market economies.
The quantity supplied of a good or service is the amount that sellers are willing and able to sell at a particular price. - Mankiw
a) True
b) False