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Learn about the concept of supply, the Law of Supply, and how it differs from the Law of Demand. Explore the factors that determine whether supplies increase or decrease. Watch informative videos and gain a comprehensive understanding of supply and its impact on the market.
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1-What is “supply’? The amount of a product offered for sale at all possible prices in the market.
2-Explain the “Law of Supply” Suppliers will normally offer more [quantity] for sale at high prices and less [quantity] at lower prices. Suppliers have an incentive to produce more at higher prices in hope of huge profits
3-How is the Law of Supply different from the Law of Demand? Supply *From the producer’s P.O.V. *The higher the price, the greater the quantity supplied and vice versa. *The supply curve slopes upward from left to right
3-How is the Law of Supply different from the Law of Demand? Demand *From the consumer’s P.O.V. *The lower the price, the greater the quantity demanded and vice versa. *The demand curve slopes downward from left to right
4-What is a supply schedule? A listing of the various quantities supplied at all possible prices
5-What is a supply curve? A graph showing the various quantities supplied at all possible prices in the market.
6-What is a “change in the quantity supplied”? What does this change respond to? The amount offered for sale in response to a change in price.
7-What is a “change in supply”? How is it different from a “change in the quantity supplied”? Change in supply: something happens that causes suppliers to offer products at different amounts for sale at all possible prices. • Curve shifts left [decrease of product supplied] or right [increase of product supplied] Change in the quantity supplied: Just a movement up and down the supply curve. Just affected by price. Price changes quantity, but it does not affect supply
8-What happens when the supply curve shifts to the: *left: less is offered at all possible prices *right: more is offered at all possible prices
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 1-Cost of Resources-an increase or decrease in the cost of land, labor or capital will shift the curve left or right
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 2-Productivity-increases whenever more output is produced using the same amount of input [cost of resources] • Happy, motivated workers: increase in supply [rightward shift] • Unhappy, unmotivated workers: decrease in supply [left]
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 3-Technology- New technology- shifts the curve rightward: lowers cost of production, labor-saving. Technological breakdown- shifts curve left because of increased costs.
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 4-Taxes and Subsidies: Taxes: higher taxes raise the cost of production and supply decreases. Lower taxes: supply increases. Subsidies:a government payment to an individual, business or other group. They lower the cost of production and increase supply. Farmers are subsidized by the government
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 5-Expectations: About future prices going up, wait for the price increase and increase supply then. Rightward Shift Future prices going down: Slow down or stop producing. Leftward Shift
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 6-Government Regulations: More regulations: Cause an increase in the cost of production and a decrease in supply: leftward shift Fewer regulations: Cause a decrease in the cost of production and a increase in supply: rightward shift
9-Name and explain the 7 factors that determine whether supplies increase or decrease. 7-Number of Sellers More sellers: increase in supply and rightward shift Fewer sellers: decrease in supply and leftward shift
