Presentation is loading. Please wait.

Presentation is loading. Please wait.

the amount of goods/services that producers are willing and able to supply at a given price. Supply: the amount of goods/services that producers are willing.

Similar presentations


Presentation on theme: "the amount of goods/services that producers are willing and able to supply at a given price. Supply: the amount of goods/services that producers are willing."— Presentation transcript:

1

2 the amount of goods/services that producers are willing and able to supply at a given price. Supply: the amount of goods/services that producers are willing and able to supply at a given price. Market supply is combined result of the decisions of all individual suppliers.

3 The price of tomatoes Higher the price = greater quantity. The prices of alternative products Production depends on prices of alternative products (outputs). Which vegetables to grow? Eg. price of cauliflowers increases – more cauliflowers and fewer tomatoes.

4 Prices of factors of production and other inputs Quantity supplied depends on costs of production. Eg. cost of labour, fertiliser, machinery increases - smaller quantity of tomatoes will be supplied at each price than before. Expected future prices Farmers influenced by future expectations Eg. higher expected future prices – increased supply of tomatoes.

5 The state of technology New technologies - lower costs - increase in quantity supplied at each price.

6 Qs = f(Px, Pg, Pf, Pe, Ty, N, …) Qs Qs = quantity of tomatoes supplied Px Px = price of tomatoes Pg Pg = prices of alternative outputs Pf Pf = prices of factors of production and other inputs Pe Pe = expected future prices of tomatoes Ty Ty = technology N N = number of firms supplying the product

7

8

9

10

11

12


Download ppt "the amount of goods/services that producers are willing and able to supply at a given price. Supply: the amount of goods/services that producers are willing."

Similar presentations


Ads by Google