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 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.

Detailed explanation-3: -a) The “law of supply” states that as price rises, quantity supplied also rises. b) If the marginal cost of producing a good is higher at high levels of output than at low levels of output, then the supply curve for that good is upward sloping.

Detailed explanation-4: -Law of supply states: As price of a good increases, the quantity supplied of the good rises, and as the price of a good decreases, the quantity supplied of the good falls, ceteris paribus. Restated: there is a direct relationship between price (P) and quantity supplied (Qs).

Detailed explanation-5: -The Law of Supply states that there is a direct relationship between the market price of a good or service and the quantity of that good or service that producers are willing and able to produce.