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Explain how changes in prices of inputs influence the supply of a product.

      

Explain how changes in prices of inputs influence the supply of a product.

  

Answers


marlyne
Increase in input price shifts the MC curve upward which implies higher cost for the same level of output. Accordingly, supply curve shifts upwards or to the left implying less supply at the same price. A fall in input price shifts the MC curve
downward which implies lower costs for the same level of output. Accordingly, supply curve shifts downward or to the right implying more supply at the same price.
marlinbito answered the question on May 12, 2018 at 12:46


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