Which of the following would increase the supply of a product?

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BlackTom AI · Accepted Answer

Let’s break down the options and apply the basic supply framework step by step.
Option 1: A decrease in the cost of a factor of production (resource).
This directly lowers production costs, which makes production more profitable at every existing price. As a result, firms are willing to supply more of the product, shifting the supply curve to the right. This is a classic determinant of increased supply.
Option 2: A decrease in the prices producers expect to receive for their goods.
In many introductory treatments, expectations about future prices influence decisions, but the standard short-run supply analysis assumes current supply depends on current costs and current prices, not on expected future prices. In some models, lower expected future prices might affect production planning, but in the conventional supply framework used for basic questions, this factor does not shift the current supply curve. Therefore, this option does not reliably indicate an current increase in supply in the typical analysis.
Option 3: An increase in consumer preferences for a good.
Higher consumer demand shifts the demand curve, not the supply curve. This change affects how much consumers want to buy, not how much producers are willing to sell at each price. So this option does not increase supply.
Option 4: An increase in the price of the product.
An increase in the product’s price leads to a movement along the supply curve (higher quantity supplied) rather than a shift of the entire supply curve. The question asks about increasing supply (a shift), so this option describes a price movement, not an explicit supply increase.
In summary, the only factor that shifts the supply curve to increase quantity supplied under standard analysis is a decrease in input costs. The other options either affect demand, rely on expectations in a non-shift way, or describe movements along the supply curve rather than a shift.

ECON 2002.01 SP2025 (25230) Quiz 3

Which of the following would increase the supply of a product?

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