Supply in economics is influenced by price changes, seen through the law of supply that shows an increase in quantity supplied as prices rise. Factors like technology, resource costs, and number of sellers impact supply, with examples ranging from oil production investments to lead paint discontinuation.
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The law of supply states that as the price of a good increases, the quantity supplied by producers will also increase, as seen in examples like the rise in worldwide oil consumption over time due to price influences.
Various factors such as federal excise taxes, subsidies, resource costs, technology, and the number of sellers significantly impact the supply of goods, with examples ranging from cigarette taxes affecting supply to technological advancements altering fabric production processes.
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What is the law of supply?
The law of supply states that as the price of a good rises, the quantity supplied will increase.