As per the NCERT glossary, the supply curve of a firm shows:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → the levels of output that a profit-maximising firm will choose to produce at different values of the market price
A firm’s supply curve answers one question: at each market price, how much will a profit-maximising firm produce?
Option (1) the levels of output that a profit-maximising firm will choose to produce at different values of the market price — Correct. This is the Glossary meaning of the firm’s supply curve.
Option (2) the relationship between the total revenue that the firm earns and the output level of the firm — Incorrect. This is the total revenue curve.
Option (3) the relationship between the market price and the firm’s output level as a horizontal straight line — Incorrect. This is the price line, which shows that the price stays the same whatever the firm sells.
Option (4) the output levels that all firms in the market produce in aggregate at different values of the market price — Incorrect. This is the market supply curve, the total of all firms.
NCERT (2026-27): Glossary: “Firm’s supply curve – shows the levels of output that a profit-maximising firm will choose to produce at different values of the market price.” Glossary: “Market supply curve – shows the output levels that firms in the market produce in aggregate corresponding to different values of the market price.” |