Alright, now that we've wrapped up our discussion on demand, let's move on to supply. So I hope you guys see a lot of similarities here between what we were doing in demand and what we're going to be doing here with supply. Supply relates to the behavior of the sellers or the suppliers in our market here. So, the suppliers, I'm going to write them both in here. Suppliers, sellers. We're going to use those terms interchangeably. You might even hear producers as well. Just like we had quantity demanded, we are going to have the quantity supplied being the amount of a good that the sellers are willing to produce, right. So we're going to use QS just like we had the QD, we've got QS here. So at any given price, there's going to be a quantity that will be supplied and the supply schedule is going to list these pairs at different prices, how much quantity will be supplied. So just like we had the law of demand, now we have the law of supply. When the price of a good rises, the quantity supplied of that good rises. So remember with demand, the price went up, the quantity demanded went down. Now they're going to be moving in the same direction. This is going to be a directly proportional relationship, right? Quantity supplied is going to rise with price. So let me write that in here. Price is going to go up, that means the quantity supplied is going to go up. Vice versa, the price goes down, quantity supplied will go down, right? And this kind of makes sense, right? If there's a higher price, more people are going to be willing to sell that product like hey, the price of cereal went up. Maybe we should get into the cereal business, right? I don't know. So the idea here is that they're going to move together. Price and quantity supplied will move in the same direction. So let's finish up our discussion here with the supply curve. Just like we had a demand curve, we are going to have a supply curve as well. So the supply curve is going to be the graph. It is a graph showing the relationship between the price of a good and its quantity supplied. And remember, just like the demand curve was what we call demand, Here, this is supply, right? So we're going to make that distinction between supply and quantity supplied and we're going to just use an S for supply. Just like we use the big D for demand we'll use the big S for supply. So here right behind me, I've got a supply schedule for wheat and we've got different prices and different quantities that will be supplied at those prices. So notice when there's a high price of $9, you're going to see a high quantity of 60,000 and as the price decreases, you're going to see decreases in the quantity supplied as well. So I've already put these points on our graph here and just to reiterate, right, we're going to have the price on the y-axis, quantity on the x-axis right? Alphabetical order is the easy way to remember that. So I'm going to go ahead and connect these dots to make our supply curve. Man, I'm just missing right now. Okay. So here we go. One more. One more. That's the one. Alright. So that will be our supply curve right there. Cool? And notice that the supply curve here I am again, hi alright notice that the supply curve slopes upward and remember my little mnemonic before the double d's demand downward and supply, well that's just the other one. If you remember demand is downward, supply is upward. Cool? Alright. Let's go ahead and move on to the next video.
Table of contents
- 0. Basic Principles of Economics1h 5m
- Introduction to Economics3m
- People Are Rational2m
- People Respond to Incentives1m
- Scarcity and Choice2m
- Marginal Analysis9m
- Allocative Efficiency, Productive Efficiency, and Equality7m
- Positive and Normative Analysis7m
- Microeconomics vs. Macroeconomics2m
- Factors of Production5m
- Circular Flow Diagram5m
- Graphing Review10m
- Percentage and Decimal Review4m
- Fractions Review2m
- 1. Reading and Understanding Graphs59m
- 2. Introductory Economic Models1h 10m
- 3. The Market Forces of Supply and Demand2h 26m
- Competitive Markets10m
- The Demand Curve13m
- Shifts in the Demand Curve24m
- Movement Along a Demand Curve5m
- The Supply Curve9m
- Shifts in the Supply Curve22m
- Movement Along a Supply Curve3m
- Market Equilibrium8m
- Using the Supply and Demand Curves to Find Equilibrium3m
- Effects of Surplus3m
- Effects of Shortage2m
- Supply and Demand: Quantitative Analysis40m
- 4. Elasticity2h 16m
- Percentage Change and Price Elasticity of Demand10m
- Elasticity and the Midpoint Method20m
- Price Elasticity of Demand on a Graph11m
- Determinants of Price Elasticity of Demand6m
- Total Revenue Test13m
- Total Revenue Along a Linear Demand Curve14m
- Income Elasticity of Demand23m
- Cross-Price Elasticity of Demand11m
- Price Elasticity of Supply12m
- Price Elasticity of Supply on a Graph3m
- Elasticity Summary9m
- 5. Consumer and Producer Surplus; Price Ceilings and Floors3h 45m
- Consumer Surplus and Willingness to Pay38m
- Producer Surplus and Willingness to Sell26m
- Economic Surplus and Efficiency18m
- Quantitative Analysis of Consumer and Producer Surplus at Equilibrium28m
- Price Ceilings, Price Floors, and Black Markets38m
- Quantitative Analysis of Price Ceilings and Price Floors: Finding Points20m
- Quantitative Analysis of Price Ceilings and Price Floors: Finding Areas54m
- 6. Introduction to Taxes and Subsidies1h 46m
- 7. Externalities1h 12m
- 8. The Types of Goods1h 13m
- 9. International Trade1h 16m
- 10. The Costs of Production2h 35m
- 11. Perfect Competition2h 23m
- Introduction to the Four Market Models2m
- Characteristics of Perfect Competition6m
- Revenue in Perfect Competition14m
- Perfect Competition Profit on the Graph20m
- Short Run Shutdown Decision33m
- Long Run Entry and Exit Decision18m
- Individual Supply Curve in the Short Run and Long Run6m
- Market Supply Curve in the Short Run and Long Run9m
- Long Run Equilibrium12m
- Perfect Competition and Efficiency15m
- Four Market Model Summary: Perfect Competition5m
- 12. Monopoly2h 13m
- Characteristics of Monopoly21m
- Monopoly Revenue12m
- Monopoly Profit on the Graph16m
- Monopoly Efficiency and Deadweight Loss20m
- Price Discrimination22m
- Antitrust Laws and Government Regulation of Monopolies11m
- Mergers and the Herfindahl-Hirschman Index (HHI)17m
- Four Firm Concentration Ratio6m
- Four Market Model Summary: Monopoly4m
- 13. Monopolistic Competition1h 9m
- 14. Oligopoly1h 26m
- 15. Markets for the Factors of Production1h 33m
- The Production Function and Marginal Revenue Product16m
- Demand for Labor in Perfect Competition7m
- Shifts in Labor Demand13m
- Supply of Labor in Perfect Competition7m
- Shifts in Labor Supply5m
- Differences in Wages6m
- Discrimination6m
- Other Factors of Production: Land and Capital5m
- Unions6m
- Monopsony11m
- Bilateral Monopoly5m
- 16. Income Inequality and Poverty35m
- 17. Asymmetric Information, Voting, and Public Choice39m
- 18. Consumer Choice and Behavioral Economics1h 16m
3. The Market Forces of Supply and Demand
The Supply Curve
Video duration:
3mPlay a video:
Related Videos