Question

For any competitive market, the supply curve is closely related to the a. firms’ costs of production in that market. b. interest rates on government bonds. c. preferences of consumers who purchase products in that market. d. income tax rates of consumers in that market

Answer 1

Answer:

The correct answer is option a.

Explanation:

The supply curve of a firm is closely related to the cost of production of the firm in a competitive market. If the cost of production is lower the firm will be able to supply more. If the cost of production is higher, the firm will supply less.  

The cost of production, on the other hand, depends upon the price of inputs used in the process of production.  

Consumer preferences and income tax rates affect the demand for goods. The interest rate on government bonds affects its demand.