ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What Is the Law of Supply? The law of supply is the microeconomic law that states that, all other factors being equal, as the price of a good or service increases, the quantity of goods or services that suppliers offer will increase, and vice versa.

Detailed explanation-2: -The law of supply states that there is a direct relationship between price and quantity supplied. In other words, when the price increases the quantity supplied also increases.

Detailed explanation-3: -The law of supply states that a higher price leads to a higher quantity supplied and that a lower price leads to a lower quantity supplied. Supply curves and supply schedules are tools used to summarize the relationship between supply and price.

Detailed explanation-4: -It’s a fundamental economic principle that when supply exceeds demand for a good or service, prices fall. When demand exceeds supply, prices tend to rise. There is an inverse relationship between the supply and prices of goods and services when demand is unchanged.

Detailed explanation-5: -The law of supply states that an increase in the price of goods or services results in an increase in the quantity that suppliers make available to the market. Existing suppliers increase production of higher-priced goods to maximize profits, while new suppliers may also enter the market.