Supply

Question 1

What is supply?

Answer 1

Supply is the quantity of a good or service that a producer is able and willing to supply at a given price during a given period of time.

Question 2

What is the mnemonic to remember the factors of supply?

Answer 2

PINTSWC

Question 3

What does the ‘p’ in PINTSWC mean?

Answer 3

Productivity - Higher productivity causes an outward shift in supply, because average costs for the firm fall.

Question 4

What does the i’ in PINTSWC mean?

Answer 4

Indirect taxes - Inward shift in supply.

Question 5

What does the ‘n’ in PINTSWC mean?

Answer 5

Number of firms - The more firms there are, the larger the supply.

Question 6

What does the ‘t’ in PINTSWC mean?

Answer 6

Technology - More advanced the technology causes an outward shift in supply.

Question 7

What does the ‘s’ in PINTSWC mean?

Answer 7

Subsidises - Subsidises cause an outward shift in supply.

Question 8

What does the ‘w’ in PINTSWC mean?

Answer 8

Weather - This is particularly for agricultural produce. Favourable conditions will increase supply.

Question 9

What does the ‘c’ in PINTSWC mean?

Answer 9

Cost of production - If the cost of productions falls, the firm can afford to supply more.

Question 10

What does joint supply mean?

Answer 10

This is when increasing the supply of one good causes an increase or decrease in the supply of another good.