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Mocks
1.2 How Markets Work (M)
1.2.4 Supply
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Lily Cope
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Cards (3)
Supply
is the
quality
of a good or service that a
producer
is
willing
and
able
to
supply
at a given
price
during a given
time.
Reasons for the
upward slope
of the supply curve.
If prices
increase
, it is more
profitable
for
firms
to
supply
the good.
High prices
encourage new
firms
to
enter
the
market.
Larger outputs
means
firms costs increase
, so they need to charge a
higher price
to
cover
the
costs.
Factors Causing a Shift in the Supply Curve (PINTSWC)
P =
Productivity
I =
Indirect Taxes
N =
Number of Firms
T =
Technology
S =
Substitutes
W =
Weather
C =
Cost of Production