3
QuizMultiple Choice

The Law of Supply — Quiz

Question 3 • Economics

Which best explains why the law of supply operates the way it does in a free enterprise economy?

Answer
A
Companies want to be as profitable as possible.
B
Companies want to hire as many workers as possible.
C
Companies want to produce more goods than their rivals.
D
Companies want to reward loyal consumers with low prices.

Explanation

The law of supply says that, other things being equal, businesses offer more of a product for sale when its price rises. A higher price can make producing and selling the product more profitable, giving companies an incentive to increase supply. Therefore, the best answer is “Companies want to be as profitable as possible.”

AI-written and checked against the verified answer.

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