Supply

Question 1

quantity supplied

Answer 1

the quantity (amount) of goods/services supplied (sold) at a given price

Question 2

supply (curve)

Answer 2

the combination of all quantities supplied

Question 3

market supply

Answer 3

the combination of the supply (from all suppliers) at a given price (horizontal formation)

Question 4

law of supply

Answer 4

1. the more expensive the good is, the more you want to supply; the less expensive the good is, the less you want to supply
2. the price and the quantity supplied are positively related (positively sloped curve)

Question 5

determinant of supply (1)
Cost of input

Answer 5

if cost of input increases, supply decreases
= shift to the left

if cost of input decreases, supply increases
= shift to the right

Question 6

determinant of supply (2)
Technology

Answer 6

if technology improves, supply increases

if technology worsens, supply decreases

Question 7

determinant of supply (3)
Government regulation- taxes, subsidies

Answer 7

if government gives subsidies for production, supply increases

if government implements a tax on production, supply decreases

Question 8

determinant of supply (4)
Expected/Future price

Answer 8

if price is expected to increase (future), you supply less now

if price is expected to decrease (future), you supply more now

Question 9

determinant of supply (5)
Number of firms/competition

Answer 9

if number of firms increase, you supply less

if number of firms decrease, you supply more

Question 10

Price determinant of supply (6)

Answer 10

The supply curve does NOT shift!
There is a change in quantity supplied
= movement along the supply curve