the market: supply

supply

amount of a product that suppliers make available to the market at any given price in a given period of time

factors affecting supply

• changes in the costs of production

• introduction of new technology

• indirect taxes

• amount of government subsidies

effect of costs of production on supply

if the changes in the costs of production increase supply decreases

how does the introduction of new technology affect supply

the introduction of new technology decreases the costs of production so supply increases

effect of indirect costs on supply

indirect costs increase the cost of production decreasing supply

governement subsidies

a grant given to producers usually to encourage the production of a certain product or service

effect of governement subsisidies on supply

more governement subsidies will decrease the costs of production and the supply will increase

external shocks examples

• world events

• weather

• government

• price realted goods or services

external shocks

factors beyond the control of business which can have an effect on the supply

how do external shocks in general affect the supply

external shocks decrease availability so the costs of production will increase

→ supply decreases

worlds events affect on supply

as the number of world events increases the uncertainty of supply will increase

effect of the weather on supply

good weather will decrease the costs of production increasing supply and vice versa

how does the governement affect supply

the government directly influences interest rates,if they increase borrowing becomes harder so the costs of production will increase

→ decreasing supply

effect of the prices of related good/ substitutes on supply

if there are cheaper products/substitutes present in the market the demand will decrease with the large supply already present in the market

long story short it depends on the case study good luck