Chapter 5 - Supply Flashcards
Supply
The willingness AND ability of sellers to produce and offer to sell different quantities of a good at different prices during a specific time period.
Law of Supply
A law stating that as the Price of a good increases, Quantity Supplied increases. As the Price of a good decreases, the Quantity Supplied of a good decreases.
Quantity Supplied
The number of units of a good produced and offered for sale at a specific price.
Supply Schedule
Numerical chart illustrating the law of supply. The points on a Supply Curve, just not on a graph.
Supply Curve
Graph that shows the amount of a good sellers are willing and able to sell at various prices. Plot of Supply Schedule
When Supply increases/decreases the curve shifts to the…
Right/Left. This is NOT Ceteris Paribus
What Factors Cause Supply Curves to Shift? (List All)
Price of Resources for Production Taxes Quotas Subsidies Number of Sellers Future Price Weather Technology
Technology
the body of skills and knowledge concerning the use of resources in production
Advancement in Technology
The ability to produce more output with a fixed amount of resources
Per-Unit Cost
The average cost of a good
Subsidy
Financial payment made by government for certain actions.
Quota
Legal limit on the number of units of a foreign-produced good (read:import) that can enter a country.
What Factor Causes a Change in Quantity Supplied?
Price. Ceteris Paribus holds.
Elasticity of Supply
Relationship between the percent change in Quantity Supplied and the percent change in Price.
Mathematical Formula for Elasticity of Supply (Es)
Percent Change in Quantity Supplied
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Percent Change in Price
