supply and the supply curve

Question 1

what is supply

Answer 1

the quantity of a good or service that a producer is willing to produce at a given price in a given time period

Question 2

movements along the supply curve

Answer 2

extension: increase in price
contraction: decrease in price

Question 3

the law of supply

Answer 3

there is a direct relationship between price and quantity supplied:
due to profit motive, at a higher price, producers will have a greater incentive to produce to earn profit

Question 4

non-price factors which affect supply

Answer 4

all apart from the no. of firms affect the cost of production

-Productivity
-Indirect tax: tax on cost of p
-No. of firms: more firms, increased supply
-Technology: decreases cost of P
-Subsidy: money grant given by the gov to firms to encourage increase in output
-weather: good weather i.e. lots of rain for crops
-Cost of P: transport, raw material costs, oil costs, regulation