Q.State whether the following statement is True or False:
Supply is indirectly related to price.

Price rises : Extension of supply :: Price falls : Contraction of supply.

The law of supply states a direct relationship between the price of a commodity and its quantity supplied, other things remaining constant.

• When price rises, producers find it more profitable to sell more, so quantity supplied increases — this upward movement along the same supply curve is called extension (expansion) of supply. …

The correct answer is Positive.

According to the law of supply, other things remaining equal, a rise in price causes a rise in quantity supplied and a fall in price causes a fall in quantity supplied — a direct relationship. Graphically this makes the supply curve slope upward from left to right, which means its slope is positive. (A negative slope would show an inverse …

The correct option is Assertion (A) is false but Reasoning (R) is true.

The law of supply states that, other things constant, the quantity supplied of a commodity varies directly with its price — supply rises when price rises and falls when price falls. So assertion (A), which claims supply falls with a rising price, is false. Reasoning (R) — that a seller earns more profit at a higher price …

The statement is False.

According to the law of supply, other things being constant, quantity supplied rises when price rises and falls when price falls. Supply is therefore directly (positively) related to price, which is why the supply curve slopes …