Question

in which of the Statements are the terms "Supply" and "Quantity supplied" used correctly? 1. When the price of ice cream rose, the quantity supplied of ice cream increased and the supply of ice cream toffings fello 2. when the price of ice cream rose, the supply of both ice cream and ree cream toffings fell. 3. where the price of ice cream rose the supply for ice cream fell and the quantity supplied of ice cream toppings fell. 4. None of these statements use the terms correctly

Answer 1

The statement which is correct is:

Option 1) When the price of ice-cream rose, the quantity supplied of ice-cream increased and the supply of ice-cream toppings fell. -

The term quantity supplied is used when the quantity supplied changes due to a change in the own price of the good, other factors remaining constant. The term supply is used when the quantity supplied changes due to a change in factors other than the change in the own price of a good.

Here both the quantity supplied and supply terms are used correctly. The statement mentioned that ice-cream prices rising and its effect on the quantity supplied other factors remaining constant. Also, ice-cream toppings is another good, so the term used for that when the price of ice-cream rises, would be supply.