Question
4. How would the Supply schedule be affected if the cost of resources (materlals) to make an iPhone decreased by 5?
Answer
4
(225 Votes)
Elsie
Elite · Tutor for 8 years
Answer
The supply schedule would shift to the right.
Explanation
The supply schedule refers to a chart that outlines how much of a certain product a manufacturer can provide at distinct price points. Here, the question asks about how the supply schedule changes if the cost of resources needed for production decreases. According to the law of supply, if the cost of production decreases, producers are more likely to supply more. Consequently, the supply schedule would shift to the right, presenting an increase in supply at all given price points. This is due to the producer’s capacity to increase production thanks to a reduction in costs, thus achieving a higher profit margin even if the market price remains unchanged.