2.2 Supply

• Supply is the quantity of a good or service that producers are willing and able to offer at various prices during a specific time period, ceteris paribus.
• The supply curve is upward sloping.
• The law of supply is the principle that states that as the price of a product increases, the quantity supplied will usually increase, ceteris paribus.
• Individual supply is the supply of one product from one firm at every price.
• Market supply is the sum of all the individual supplies of a product at every price.
• Non-price determinants of supply:

  • changes in costs of factors of production
  • prices of related goods (joint and competitive supply)
  • indirect taxes and subsidies
  • future price expectations
  • changes in technology
  • number of firms