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In: Economics

Graphically, market supply for a product: a)is the horizontal difference of the individual supply curves. b)is...

Graphically, market supply for a product:

a)is the horizontal difference of the individual supply curves.

b)is the horizontal sum of the individual supply curves.

c)is the vertical difference of the individual supply curves.

d)is the vertical sum of the individual supply curves.

Solutions

Expert Solution

Option

b)is the horizontal sum of the individual supply curves.

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The market supply curve means summing quantities supplied at each price of each firm and quantity is on the x-axis so it is the horizontal summation of the supply curve of individual firms.

The vertical summation is done in the case of public good where marginal benefit at each unit is summed.

Rahul Sunny answered 2 years ago
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