Supply

Read this section to learn about the theory of supply. Attempt the "Try It" problem. Use the data from the text to practice drawing the supply curve on your own, either on paper or in Excel. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter.

Key Takeaways

  • The quantity supplied of a good or service is the quantity sellers are willing to sell at a particular price during a particular period, all other things unchanged.
  • A supply schedule shows the quantities supplied at different prices during a particular period, all other things unchanged. A supply curve shows this same information graphically.
  • A change in the price of a good or service causes a change in the quantity supplied ­– a movement along the supply curve.
  • A change in a supply shifter causes a change in supply, which is shown as a shift of the supply curve. Supply shifters include prices of factors of production, returns from alternative activities, technology, seller expectations, natural events, and the number of sellers.
  • An increase in supply is shown as a shift to the right of a supply curve; a decrease in supply is shown as a shift to the left.