Connected Ring Matrix: Understanding the difference between the price at which a

Relationship between
product is sold and the cost of producing it.
Sellers' Willingness to Sell, Producer
Surplus, and Supply Curve Continuing counterclockwise, we come to

the sellers' willingness to sell, which

INTRODUCTION represents the minimum amount that sellers

In the world of economics, the are willing to accept for a product or service.

relationship between sellers' willingness to

sell, producer surplus, and supply curve is UNDERSTANDING THE

critical to understand. To help illustrate this RELATIONSHIPS

relationship, we will use a connected ring The connected ring matrix helps us

matrix. This matrix will show the to understand the relationships between

overlapping relationships between these these concepts. For example, when the
price
concepts, and how they are interconnected
of a product increases, it will generally lead
in a particular sequence.
to an increase in the quantity of that product
CONNECTED RING MATRIX
that sellers are willing to offer. This, in turn,
Starting with the first concept,
leads to an increase in producer surplus, as
sellers' willingness to sell, we move
sellers are able to sell more of their product
clockwise around the ring to the next
at a higher price.
concept, producer surplus. This is the
Conversely, when the price of a
amount that sellers receive for selling a
product decreases, sellers may be less
product or service, above and beyond the
willing to sell that product, as the producer
minimum amount they are willing to accept.
surplus will be lower. This will result in a
Moving clockwise again, we come to the
decrease in the quantity of that product that
supply curve, which represents the
is offered, which can lead to an increase in
relationship between the price of a product
the price. As the price increases, sellers
and the quantity of that product that sellers
become more willing to sell, and the cycle
are willing to offer.
repeats.
Moving counterclockwise from the

supply curve, we come to the concept of

CONCLUSION
producer surplus. This represents the
The connected ring matrix is a useful

tool to help illustrate the relationships

between sellers' willingness to sell, producer

surplus, and supply curve. Understanding

these relationships is crucial for anyone

interested in the world of economics,

whether as a producer or a consumer. By

using this matrix, we can gain a deeper

understanding of these concepts and how

they relate to each other.