Unit I: Supply

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Supply can be shown in two ways:

A supply schedule shows how price relates to quantity.

Image result for supply schedule

A supply curve shows the demand schedule on a graph. An increase in supply shifts the curve to the right while a decrease in supply shifts the curve to the left.
Image result for supply curve
Supply is the quantities that producers are willing and able to produce at various prices.

The law of supply states that there is a direct relationship between price and quantity supplied. This means as price increases, quantity supplied increases. Likewise, as price decreases, quantity supplied decreases.
Image result for the law of supply

Δ in price is what causes a "change in quantity supplied" (ΔQS).

There are six determinants that can cause a "change in supply" (ΔS):

Δ in number of sellers/suppliers
Δ in the costs of production/resource costs
Δ in technology
Δ in weather
Δ in expectations
Δ in taxes or subsidies

Comments

  1. Lance D.September 5, 2019 at 10:27 PM

    An increase in supply causes a graph to shift to the right while a decrease in supply causes a graph to shift to the left.

    ReplyDelete

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