An economist says: The supply curve has two interpretations. What ...

[CharlieWard]

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]

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

[CharlieWard]

Thanks for the timely response, appreciate it

[ryhom]

Gracias!