Question

Suppose there are six bait and tackle shops that sell worms in a lakeside resort town in Minnesota. If we add the respective quantities that each shop would produce and sell at each of the six bait and tackle shops when the price of worms is $2 per bucket, $2.50 per bucket, and $3 per bucket, and so forth, we have found the
A. market demand curve.
B. surplus or shortage depending on market conditions.
C. market supply curve.
D. equilibrium curve.

Answer 1

Answer:

The correct answer is option C.

Explanation:

There are six bait and tackle shops that sell worms in a lakeside resort town in Minnesota.

If we add the respective quantities that each shop would produce and sell at each of the six bait and tackle shops at different prices we will find the market supply curve.

A market supply curve shows the total quantity of a product that all the firms in the market will supply at different price levels. It is the horizontal summation of individual supply curves.

The market supply curves are generally upward sloping. This is because of the positive relationship between the quantity supplied and the price level.