Given the supply of a commodity, x, and the price of a commodity, y, would you expect a positive correlation, a negative correlation, or no correlation?
A)negative correlation
B)positive correlation
C)no correlation

Question

Quizplus · Accepted Answer

According to the law of supply, as the supply of a commodity increases, the price of the commodity tends to decrease. Therefore, we can expect a negative correlation between x (supply) and y (price).

Given the Supply of a Commodity, X, and the Price