Other things remaining constant, the market supply for a good increases if: 1. its price increases. 2. price of its factors of production decreases. 3. price of other goods decreases.

examrobotsa's picture

Submitted by examrobotsa on

Q: 3 (CDS-II/2023)
Other things remaining constant, the market supply for a good increases if:
1. its price increases.
2. price of its factors of production decreases.
3. price of other goods decreases.

question_subject: 

Economics

question_exam: 

CDS-II

Supply generally increases when the price of the good itself increases because producers aim to maximize profits. Additionally, a decrease in the price of inputs (factors of production) reduces production costs, also leading to an increase in supply. A decrease in the price of other goods doesn't typically increase the supply of the good in question as it might make producing those goods more attractive instead.