ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -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 tendency of suppliers to offer more of a good at a higher price is known as the Law of Supply. The law of supply states that an increase in the price of a good or service would increase its quantity supplied by the sellers when all other determinants are kept constant.

Detailed explanation-3: -The law of supply results from the general tendency for the marginal cost of producing a good or service to increase as the quantity produced increases. Producers are willing to supply a good only if they can at least cover their marginal cost of production.

Detailed explanation-4: -Economists call this the Law of Demand. If the price goes up, the quantity demanded goes down (but demand itself stays the same). If the price decreases, quantity demanded increases. This is the Law of Demand.

Detailed explanation-5: -According to basic economic theory, the supply of a good will increase when its price rises. Conversely, the supply of a good will decrease when its price decreases. There’s also price elasticity of demand. This measures how responsive the quantity demanded is affected by a price change.