Author Question: An economist says: The supply curve has two interpretations. What does the economist mean? What ... (Read 119 times)

CharlieWard · **on:** Jun 29, 2018

An economist says: The supply curve has two interpretations. What does the economist mean?

What will be an ideal response?

Question 2

Recall from Chapter 5: Other things constant, when households lower their time preferences, and demonstrate a willingness to postpone some present consumption for future consumption,

A) their savings increase.
B) their savings decrease.
C) the budget deficit increases.
D) the budget deficit decreases.

bigcheese9 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

The first interpretation is that the supply curve shows the quantities of a good or service that producers are willing and able to sell at each price, other things being equal. The second interpretation is that the supply curve is a minimum-supply-price curve, so that for each quantity it shows the lowest price at which someone is willing to sell another unit.

Answer to Question 2

A