2.3 Supply Flashcards
1
Q
What is supply?
A
The quantity that sellers are willing and able to sell at a given price in a given period of time
2
Q
What is the law of supply?
A
Quantity supplied will usually increase as price increases, quantity supplied will usually fall as price falls, ceteris paribus
3
Q
How do changes in price cause a movement along the supply curve and why is the supply curve upward sloping?
A
Profit margin, producer substitution effect
4
Q
What causes the supply curve to shift?
A
If any non price factor affecting supply changes
5
Q
What is competitive supply?
A
Where a firm can use the same resources to produce more than one product
6
Q
What is joint supply?
A
Where a firm produces more than one product together - eg. a by product
