Supply Law of Supply Determinants of Supply Equilibrium Surplus and Shortage Prepared By Ali Siddiqi
The total amount or quantity of a good or product that producers are willing and able to sell at various prices (Schiller) The total amount of output of goods and services in an economy (Sloman) Prepared By Ali Siddiqi
Different Prices=Different Demand Different Prices=Different Supply Law of Demand: As the prices increase…. Law of Supply: As the price of the product or service increases…suppliers will supply more. Prepared By Ali Siddiqi
Supply Schedule is a table showing the different quantities supplied at different prices Prepared By Ali Siddiqi Table 2.2 : The supply of potatoes (monthly) Price (pence per kg) Farmer X’s supply (tonnes) TOTAL market supply (tonnes : 000s) a b c d e
A graph showing the relationship between the price of goods and the quantity of the good supplied over a period of time Upward sloping Positively Slopped Prepared By Ali Siddiqi
Price (pence per kg) Quantity (tonnes: 000s) Supply a b c d e P Q abcdeabcde Market supply of potatoes (monthly)
Capacity and technology Cost of production Random Events “Shocks” Expectations of Future Prices Prices of Substitutes and Compliments Prepared By Ali Siddiqi
This is the point where supply equals demand. At this point suppliers are supplying the same amount of products as demanded. Agreement point Prepared By Ali Siddiqi
On Board Prepared By Ali Siddiqi