market supply
- Created by: Hetal M
- Created on: 08-05-17 19:07
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- market supply
- supply
- amount that a producer is willing and able to supply at a certain price in the market
- basic law of supply
- selling price increases = opportunity to expand into the market
- higher selling price = produce more
- causes of change in Supply
- costs of production
- lower unit cost = sell more at a higher price = profit
- high unit cost = inward shift of supply
- e.g. increased raw material price
- external shocks
- high impact on market
- e.g. car manufactures gets ruined in earthquake = whole production line stops
- anything affecting the market from producing products
- e.g. bad weather, natural disasters, new entrants
- high impact on market
- new technology
- encourages new entrants = increasing supply
- existing suppliers become more efficient = trying to keep their job
- e.g. laser cutting, 3D printing
- encourages new entrants = increasing supply
- taxation and subsidies
- subsidy = form of support from government
- e.g. solar panels should be fitted on houses = need supply of panels
- costs of production
- subsidy examples
- biofuel for farmers
- solar panels
- apprenticeship schemes
- aid to businesses making loss
- wind farm investment
- food/fuel for consumers
- child care for working families
- rail industry
- supply
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