law of supply how much do we make?. s s2
TRANSCRIPT
Law of Supply
How Much Do We Make?
S
S2
S3
If the cost of an input INCREASES, Supply of that good will DECREASE (shift to the left)
If the cost of an input DECREASES, Supply of that good will INCREASE (shift to the right)
If the cost of Labor INCREASES, Supply of that good will DECREASE (shift to the left)
If the cost of Labor DECREASES, Supply of that good will INCREASE (shift to the right)
As new technology is applied to production, Supply of that good will INCREASE (shift to the right)
As the number of sellers INCREASES, Supply of that good will INCREASE (shift to the right)
As the number of sellers DECREASES, Supply of that good will DECREASE (shift to the left)
If the price of a good is expected to INCREASE, the Supply of that good in the short term will DECREASE (shift to the left)
If the price of a good is expected to DECREASE, the Supply of that good in the short term will INCREASE (shift to the right)
If government regulation on a good INCREASES, the Supply of that good will DECREASE (shift to the left)
If government regulation on a good DECREASES, the Supply of that good will INCREASE (shift to the right)
Changes in Supply
• Supply ShockA sudden decrease in production as a result of a natural disaster or accident.
Supply DECREASES