The Law of Supply

As price rises, the quantity supplied rises, cet. par.

Reasons for the Law of Supply?

Monetary incentives The Law of Increasing Opportunity Costs

What is a Supply Schedule?

Shows the specific quantity of a good or service that suppliers are willing and able to provide at different prices

1999 South-Western College 3 Publishing

Price Quantity Supplied

$5 0

$6
$7

1
2

$8
$9 $10

3
4 5
4

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What is a Supply Curve?

Depicts the relationship between price and quantity supplied

1999 South-Western College 5 Publishing

P 2 P

S
Q1
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1 Q2
6

What is Market -day Supply?

A market situation in which the quantity of a good supplied is fixed, regardless of price

1999 South-Western College 7 Publishing

P 2 P

1
Q
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What is a change in Supply?

A change in the amount supplied of a good that is caused by factors other than a change in the price of that good

1999 South-Western College 9 Publishing

Shift in Supply

S 1S2

Q
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