SUPPLY
By Supply we mean the quantity of commodity that a seller is prepared to sell at a given price at a given time.
Factor determining supply of the commodities
1-higher the price of the commodity the supply will be increases and lower price will decreases the supply
2-supply is also depend on related goods supply like if the supply of tea will increases so the supply of sugar will also increases
3-natural calamity also change the supply. if drought occur the supply of agricultural products will be decreased
4-if factor of production like land labour capital cost will increase the supply of the goods will decreases
5-if the technology is latest it can make products in cheap and very fast so the supply will increases
6-supply is also depend on means of transport. Supply will decrease if the transport facilities is not their
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Law of supply
"it says as the price rise, other things remaining the same, the supply rises and as the price falls the supply decreases"
Price of sugar quantity supplied
3 200
4.5 500
5.5 800
6.0 1000
Assumptions of the law
1-Income of buyers and sellers remains constant
2-Taste and preferences of buyers and sellers remain the constant
3-there is no change in the techniques of production
4-costs of all the factor of production remain same
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