The quantity of a good or service that a producer is able and willing to supply at a given price during a given period of time
Supply curves
Upward sloping
If price increases, it is more profitable for firms to supply the good, so supply increases
High prices encourage new firms to enter the market, because it seems profitable, so supply increases
With larger outputs, firm's costs increase, so they need to charge a higher price to cover the costs
Factors that shift the supply curve (PINTSWC)
Productivity
Indirect taxes
Number of firms
Technology
Subsidies
Weather
Costs of production
Productivity
Higher productivity causes an outward shift in supply, because average costs for the firm fall
Indirect taxes
Inward shift in supply
Number of firms
The more firms there are, the larger the supply
Technology
More advanced the technology causes an outward shift in supply
Subsidies
Subsidies cause an outward shift in supply
Weather
Particularly for agricultural produce. Favourable conditions will increase supply
Costs of production
If costs of production fall, the firm can afford to supply more. If costs rise, such as with higher wages, there will be an inward shift in supply
Depreciation in the exchange rate
Increases the cost of imports, which will cause an inward shift in supply
Joint supply
Increasing the supply of one good causes an increase or decrease in the supply of another good. For example, producing more lamb will increase the supply of wool
