Price of input influencing goods supply
Elucidate how does change in price of input influence the supply of a good.
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Increase in price of input: Increase in price of input is cause of a decrease in the supply of a good because the production cost of a good will increase due to increase in price of input. It will reduced the profit. So producer will decrease the supply of the good.
Decrease in price of Input: Decrease in price of input is a cause of increase in supply because when the price of input decrease the production cost of a good also also decreases. Decrease in cost increases the profit margin. It motivate to producer to increase the supply of the good.
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When Info-Gadget and Inc. offers only 333 thousand generic potato peelers monthly at $1 each as well as 1,667 thousand at $2 each, its price elasticity of supply is around: (1) 1.0. (2) 1.5. (3) 2.0. (4) 3.0. (5) 0.5. Discover Q & A Leading Solution Library Avail More Than 1444642 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads No hassle, Instant Access Start Discovering 18,76,764 1937494 Asked 3,689 Active Tutors 1444642 Questions Answered Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!! Submit Assignment
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