supply

(noun)

The amount of some product that producers are willing and able to sell at a given price, all other factors being held constant.

Related Terms

Examples of supply in the following topics:

  • Supply Schedules and Supply Curves

    • A supply schedule is a tabular depiction of the relationship between price and quantity supplied, represented graphically as a supply curve.
    • A supply schedule is a table that shows the relationship between the price of a good and the quantity supplied.
    • The supply curve is a graphical depiction of the supply schedule that illustrates that relationship between the price of a good and the quantity supplied .
    • The supply curves of individual suppliers can be summed to determine aggregate supply.
    • One can use the supply schedule to do this: for a given price, find the corresponding quantity supplied for each individual supply schedule and then sum these quantities to provide a group or aggregate supply.

  • Introducing Aggregate Supply

    • Aggregate supply is the total supply of goods and services that firms in a national economy plan to sell during a specific time period.
    • The short-run aggregate supply curve is upward sloping because the quantity supplied increases when the price rises.
    • In the long-run, the aggregate supply is graphed vertically on the supply curve.
    • The long-run aggregate supply curve is static because it is the slowest aggregate supply curve.
    • Aggregate supply is the total quantity of goods and services supplied at a given price.

  • Measuring the Price Elasticity of Supply

    • The price elasticity of supply is the measure of the responsiveness of the quantity supplied of a particular good to a change in price.
    • In this case, the price elasticity of supply determines how sensitive the quantity supplied is to the price of the good.
    • When calculating the price elasticity of supply, economists determine whether the quantity supplied of a good is elastic or inelastic.
    • PES = 0: Supply is perfectly inelastic.
    • PES = infinity: Supply is perfectly elastic.

  • Determinants of Supply

    • Supply levels are determined by price, which increases or decreases supply along the price curve, and non-price factors, which shifts the entire curve.
    • Supply is the quantity of a good or service that a supplier provides to the market.
    • The market supply curve is the horizontal summation of the individual supply curves.
    • These regulations can affect a good's supply.
    • If the price of a good changes, there will be movement along the supply curve.

  • Market Supply

    • Market supply is the summation of the individual supply curves within a specific market where the market is characterized as being perfectly competitive.
    • As a result, the supply curve is upward sloping .
    • Market supply is the summation of the individual supply curves within a specific market.
    • The market supply curve is simply the sum of every seller's individual supply curve.
    • The market supply curve is an upward sloping curve depicting the positive relationship between price and quantity supplied.

  • Changes in Supply and Shifts in the Supply Curve

    • The supply curve depicts the supplier's positive relationship between price and quantity.
    • The change in price will result in a movement along the supply curve, called a change in quantity supplied, but not a shift in the supply curve.
    • Changes in supply are due to non-price changes.
    • The supplier will supply less at each quantity level.
    • Distinguish between shifts in the supply curve and movement along the supply curve

  • Macroeconomic Equilibrium

    • There are four basic laws of supply and demand.
    • The laws impact both supply and demand in the long-run.
    • Aggregate supply is the total supply of goods and services that firms in a national economy plan on selling during a specific time period.
    • This graph shows the three stages of aggregate supply.
    • Changes in aggregate supply cause shifts along the supply curve.

  • Definition of Price Elasticity of Supply

    • The price elasticity of supply is the measure of the responsiveness in quantity supplied to a change in price for a specific good.
    • The price elasticity of supply (PES) is the measure of the responsiveness in quantity supplied (QS) to a change in price for a specific good (% Change QS / % Change in Price).
    • PES = 0: The supply curve is vertical; there is no response of demand to prices.
    • Supply is "perfectly inelastic."
    • Supply is "perfectly elastic."

  • The Law of Supply

    • The law of supply states that there is a positive relationship between the quantity that suppliers are willing to sell and the price level.
    • The law of supply is a fundamental principle of economic theory.
    • It states that an increase in price will result in an increase in the quantity supplied, all else held constant.
    • An upward sloping supply curve, which is also the standard depiction of the supply curve, is the graphical representation of the law of supply.
    • Supply has a positive correlation with price.

  • Supply Function

    • A supply function is a model that represents the behavior of the producers and/or sellers in a market.
    • Like the demand function, supply can be viewed from two perspectives.
    • Figure III.A.5 is a graphical representation of a supply function.
    • The equation for this supply function is Qsupplied= -10 + 2P.
    • Table III.A5 also represents this supply function.