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SupplyTina
SupplyThequantityofaproductthatproducersarewillingandabletoprovideatdifferentmarketpricesoveraperiodoftime.Soifafirmsupplieragoodoraservice,thefirm1.hastheresourcesandtechnologytoproduceit.2.canprofitfromproducingit3.planstoproduceitandsellit
LawofSupplyOtherthingsremainingthesame,thehigherthepriceofagood,thegreateristhequantitysupplied;andthelowerthepriceofagood,thesmallerisquantitysupplied.
SupplyCurveThisisshowstherelationshipbetweenthequantitysuppliedandthepriceofaproduct.
A$2040B1030C620PointPriceQuantityAnIndividualSeller’sSupplyforCompactDiscs
$20$15$10$510203040ABCSupplyCurveAcompany’sSupplyCurveforCompactDiscsPQ
WhatisMarketSupply?Thehorizontalsummationofallthequantitiessuppliedatvariouspricesthatmightprevailinthemarket
$25$20$15$1010PQ1520SuperSoundSupplyCurveS125
$25$20$15$1020PQ2530HighVibesSupplyCurveS235
$2525+35=60$20203050$15152540$10102030$551520PriceSuperSoundHighVibesTotalSuppliedMarketSupplyScheduleforCompactDiscs
$25$20$15$1040PQ4555MarketSupplyCurve60Stotal
ChangeinquantitysuppliedVS.ChangeinsupplyChangeinthequantitysupplied:thisisamovementalongthesupplycurvewhichinresponsetochangeinthepriceofaproduct.(movealongthecurve)Changeinsupply:thisiswhereachangeinanon-pricefactorleadstoanincreaseordecreaseinwillingnessofaproducertosupplyaproduct.Thismeansmoreoftheproductisbeingsuppliedatthesameprice.
Whenpricechanges,whathappens?Thecurvedoesnotshift-thereisachangeinthequantity
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