Movement along the supply curve

Subdecks (3)

Cards (12)

  • Normal supply curves slope upwards from left to right with a direct relationship between price and qty supplied.
  • Initial price of commodity - P0
    Initial qty supplied - Q0

    When price reduces, it moves from P0 to P1 and the qty reduces from Q0 to Q1. This causes movement from point a to b (contraction)

    When price increases, it moves from P0 to P2 , the qty supplied increses from Q0 to Q2. This causes movement from point a to c ( expansion/extension)