Module 6

• Supply
  • The amount of a good or service people are willing to sell at a specific price.
• Law of Supply
  
  • Directly proportional relationship between selling price and supply.
  • As the selling price increases, quantity increases.
• Supply Curve
  • Upward sloping from left to right.
    • Price is on the y-axis.
    • Quantity is on the x-axis.
  • A movement on the supply curve is a result of a change in selling price.
• Factors that shift the supply curve (twigs):
  • T: Technology
    • Increase in technology results in an increase in supply.
  • W: Weather, catastrophe, force of nature
    • Increase in catastrophic events results in a decrease in supply.
  • I: Input costs for producer (cost of production)
    • Increase in production costs results in a decrease in supply.
  • G: Government regulation (cost of production)
    • Increase in government regulation results in a decrease in supply.
  • S: Number of sellers
    • Increase in competition results in an increase in supply.
  • These essentially mirror the PPC
• Quantity Supply vs Supply
  • Quantity supply changes as a result of a change in selling price. 
• Input
  • Any good or service that is used to produce another good or service.
• Supply Schedule
  • Tabular representation.
• MCP
  • Market Clearing Price
  • Where the demand and supply curve meet.