Supply

What is supply?

The quantity of goods and services produces are willing to make at a particular price at a particular point in time

What is the law of supply?

any increase in price will result in an increase in supply.

Why is the law of supply is the case?

it incentivises businesses to produce more

Why is the supply curve sloping upwards?

because existing producers will find it profitable to raise their production, and new producers will be attracted to the market

A movement on the supply curve is caused by?

price only

A shift in the supply curve is caused by?

a factor other than price changed

Price of other goods and services

If one product becomes more profitable then firms are less willing to supply the previous good, and will start producing the more profitable good or service

Expected future prices

If the supplier believes the price will rise in the future, they are likely to increase

production to meet this expected increase in demand.

State of technology

Improvements in technology lower production costs and allow more firms to supply

more goods at a given price.

Price of factors of production

Any fall in the cost of factors of production would allow firms to supply more of a particular good, whereas any rise in factor costs would often lead to a decrease in supply

Quanitity of the good available

The actual quantity of the good available effects supply, the less of a good the more it costs

Climatic conditions

effects agricultural products