SUPPLY AND SUPPLY CURVE Flashcards

1
Q

SUPPLY

A

Quantity of g/s producers are willing and able to produce at a given price in a given time period

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2
Q

Law of supply

A

there’s a direct relationship between price and quantity supplied

As price increase Q S increase

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3
Q

When thinking of law of supply we say

A

ceteris paribus

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4
Q

supply being upward slopig indicates

A

direct relationship

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5
Q

cetris paribus isolates

A

movemts related to price

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6
Q

As price increase from P1 - P2 , explain what happens with supply

3 marks

A

QS increases

move upwards the supply curve

which is an extension of supply

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7
Q

as price decrease from p1 - p3 what happens with supply

3 marks

A

QS decreases

as we move down the supply curve

which is a contraction of supply

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8
Q

we move along curve to demo

A

law of supply

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9
Q

what two reasons do producers supply more when price goes up

A

profit motive private producers have + COP

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10
Q

explain profit motive when price increases for suppliers

A

If price goes up potentially more profit to be made if able to produce and sell more

so strong incentive to supply more to make profit

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11
Q

explain COP motive to increase supply when price increases

3 marks

A

when q goes up supplier want higher price

as cop go up for suppliers to produce extra unit

so want higher price ot cover COP to allow em to maintain profit margins

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12
Q

draw supply curve being affected by price

A

x axis - Q

Y - price

P1-P3 SHIFT

Q1- Q3 shifts

extension upwards + arrow

contraction downward + arow

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13
Q

non price factors do what to supply

A

shift indepndent of price

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14
Q

what influences willing + ability in supply

A

COP

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15
Q

explain how lower COP influences willing + ability

2 marks

A

willing at same price to supply more as if you supply extra unit

reduction in costs mean can cover COP at same price easily -

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16
Q

Increase in COP shift supply left as

A

producers less willing and able to produce with their COP at same price

17
Q

Acronym for non price supply shifters

18
Q

P in PINTSWC

A

productivity

19
Q

I in PINTSWC

A

indirect tax

20
Q

N in PINTSWC

A

number of firms

21
Q

T in PINTSWC

A

technology

22
Q

S in PINTSWC

23
Q

W in PINTSWC

24
Q

C in PINTSWC

25
Explain how productivity can shift labour supply to the right
labour/capital workers become more productive (producing more) + paid sme in give time period reducing COP shifting supply to right.
26
draw a decrease in prodcutivity + explain
cost of production increase as paying workers same amount but producing less in given time period shifting supply to left from S1 - S3 and reducing Q produced
27
whats indirect tax
tax on production that firms have to pay
28
explain how implemetned indirect atx on firms affects supply curve
increases COP supply curve shifts to left QD decreases
29
explain how a high number of firms entering mkt affects supply curve
more supply in mkt supply curve shifts right from S1 - S2
30
technology massivley affects COP t/f
t
31
explain effect of improvement in tech on supply curve
reduces COP as maybe don't need to pay labour shifting supply right ,
32
whats a subsidy
money grant give n by gov to producers to lower COP and encourage increase in output
33
if i take away or decrease subsidy explain effect on supply
COP increase then supply shifts left from S1 -S3 and Q decreases
34
explian effect on good weather
allows supply to increase shifting supply to right from S1 - S2 and increasing quantity
35
what are the 6 cop
transport oil utilities raw materiasl labour regulation - health and safety or environmentla laws
36
draw on graph what happens if labour COP increases
cop increases shift supply left reduce QD
37
what affects COP
PITS
38
HOW DO WE rember WC in pints wc
when we drink lots of pints we neeed the WC hahahakakak