In microeconomics, what does a supply curve show?

• A. The relationship between consumer income and the equilibrium price of a good in a market
• B. The relationship between the price of a good and the quantity suppliers are willing and able to sell over a given time period, holding other factors constant
• C. The level of total revenue firms earn at each possible quantity sold, holding price constant
• D. The relationship between the price of a good and the quantity consumers are willing and able to buy over a given time period, holding other factors constant

Answer: (B)

Verified step by step guidance

1. Understand that a supply curve is a fundamental concept in microeconomics representing how suppliers behave in the market.
2. Recognize that the supply curve shows the relationship between the price of a good and the quantity that suppliers are willing and able to sell over a specific time period.
3. Note that this relationship assumes other factors (like technology, input prices, and number of sellers) are held constant, which is known as the ceteris paribus condition.
4. Distinguish the supply curve from the demand curve, which instead shows the relationship between price and quantity demanded by consumers.
5. Remember that the supply curve typically slopes upward, indicating that higher prices incentivize suppliers to offer more quantity for sale.