According to the Law of Supply

question 25

Multiple Choice

According to the law of supply:

• A) there is a direct relationship between price and the quantity supplied.
• B) there is an inverse relationship between price and the quantity supplied.
• C) there is a direct relationship between price and quantity demanded.
• D) there is an inverse relationship between price and quantity demanded.

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Definitions:

Tax Incidence

The distribution of the economic burden of a tax between buyers and sellers, depending on the elasticity of demand and supply.

Net Profits

The actual profit after working expenses not included in the calculation of gross profit have been paid.

Goods And Services

Refers to the tangible products (goods) and intangible items (services) produced and offered in an economy.

Average Tax Rate

The total tax paid divided by the total income, often expressed as a percentage.