In economics, supply is the amount of something that companies are willing to provide in a market. The law of supply and demand will decide the price at which something will be bought and sold.

Description

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According to C.R. McConnell and S.L.Brue, a supply is a scale showing the amount of a good or service that sellers offer for sale in the market at different prices for a while

The volume of supply (volume of output) is the number of goods that a commodity producer (enterprise, firm) is ready to offer at a certain price for a certain period, all other things being equal.

Amount of supply is the amount of a product or service that is on sale at a certain price at a certain time.

It is possible to consider both an individual supply (the offer of a specific seller) and the total value of the supply (the offer of all sellers present on the market). In economics, it is mainly the total value of the supply for a product or service that is studied.

Supply law

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The law of supply is a direct relationship between the price and the value of the supply of goods or services during a certain period.

The increase in prices leads to additional profit, allowing the manufacturer to expand production, attracting new manufacturers to the market.

The manufacturer's main task is to solve the problem — how much product to make at a given price. There are 2 general ideas:[1]

Factors affecting supply

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Various factors can make a seller more or less willing to produce and sell a good.[2] The more common ones are:

There may be other factors that affect the supply of a good, especially since it depends on whether the seller is willing to produce and sell the good.

References

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  1. "Greg Mankiw". Wikipedia. 2021-03-02.
  2. Melvin & Boyes, Microeconomics 5th ed. (Houghton Mifflin 2002).
  3. Ayers & Collins, Microeconomics (Pearson 2003) at 66.
  4. Rosen, Harvey (2005). Public Finance, p. 545. McGraw-Hill/Irwin, New York.
  5. Goodwin, N, Nelson, J; Ackerman, F & Weissskopf, T: Microeconomics in Context 2d ed. Page 83 Sharpe 2009.
  6. Goodwin, Nelson, Ackerman, & Weissskopf, Microeconomics in Context 2d ed. (Sharpe 2009) at 83.