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kangalkiz
kangalkiz
Student
Graduate School

Factors which could lead to an increase in the supply?

This is a economics question.

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Posted by kangalkiz on Monday June 8, 2009 at 2:06 PM and tagged with business, economics, supply.

Answers:

  1. krishna-agrawala
    krishna-agrawala Teacher
    Graduate School

    eNotes Editor

    Best answer as selected by question asker.

    The quantity of a product manufacturers are willing to supply to the market. They select a level of supply that maximizes their profit. When the quantity supplied in a market is equal to the quantity demanded or purchased by consumers it is called an equilibrium condition. Manufactures will increase supplies beyond a given level of equilibrium under two conditions that disturb the equilibrium.

    • The consumers are willing to pay higher price for the product, making it more attractive for the manufacturers to produce and sell more.
    • The manufacturer is able to cut cost of manufacturer and therefore reduce the price without reducing the profit margin. With reduced price the consumers are willing to buy more and therefore the manufacturers are ready to supply more.

     

     

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    Posted by krishna-agrawala on Tuesday June 9, 2009 at 2:08 AM