Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the ACCA Certification Exam with interactive quizzes and detailed explanations. Get a head start on your success with our comprehensive study tools.

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

In which direction does the supply curve typically travel?

From right to left
From left to right, pointing downwards
From left to right, pointing upwards
Vertically along the y-axis

The correct answer is: From left to right, pointing upwards

The supply curve typically travels from left to right, pointing upwards, which indicates that as the price of a good or service increases, the quantity supplied also increases. This relationship reflects the fundamental principle of supply in economics, known as the law of supply. When suppliers receive higher prices, they are more inclined to produce and offer greater quantities of the good or service to the market, motivated by potential profit. As for the other options, a downward slope from left to right would suggest a decrease in supply with an increase in price, which contradicts the law of supply. A vertical line along the y-axis would indicate that supply is completely inelastic, meaning that supply does not change regardless of price, which is not characteristic of most goods and services in a competitive market.