Supply

Chapter 4⎹ Managerial Economics

“People curse the one who
hoards again, but they pray
god’s blessing on the one
who is willing to sell.”
Proverbs 11:26
Definition

• Schedule or curve showing various amounts of a

product that producers are willing and able to
make available for sale at each series of possible
prices during a specified period (MCCONNELL &
BRUE, 2008).
• Usually, it is plotted as a supply curve showing the
relationship of price to the amount of product
businesses are willing to sell.
• Amount of some product which will be available to
customers.
• Law of Supply: As the price
rises, the quantity supplied rises;
as price falls, the quantity
supplied falls. There is a direct
relationship between price and
quantity supplied.
Determinants of
Supply

• Resource Prices
• Technology
• Taxes and Subsidies
• Prices of Other Goods
• Producer Expectations
• Number of Sellers