Workforce production - if your workers become better skilled perhaps because of better training - then the costs in the long run will tend to fall supply more profits rise and curve shifts right.
Price of substitutes - if price for a reasonable substitue rises then the firm might decide to switch its production to this type of product. e.g. farming ( cabbages, brocoli)
Price of complements - if goods and services rise for one of them then the firm might choose to produce the complementary product - supply shifts right,
Indirect taxes - if the governent imposes tax on a product e.g. VAT - raises cost. supply curve shifts left because firms might back out of their supply.
Indirect taxes
Two main types - Ad valorem tax (% added on - VAT)
Specific tax - a fixed amount of tax on each unit e.g. import duties
If the government imposes a sales tax on products e.g. VAT then the costs of firms will rise - supply shifts left.
Comments
No comments have yet been made