ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A change in the number of sellers in an industry changes the quantity available at each price and thus changes supply. An increase in the number of sellers supplying a good or service shifts the supply curve to the right; a reduction in the number of sellers shifts the supply curve to the left.

Detailed explanation-2: -Economists call this situation an “excess supply” – that is the quantity demanded is less than the quantity supplied at the given price. This is also called a surplus.

Detailed explanation-3: -The number of sellers willing and able to sell a good, which is assumed constant when a supply curve is constructed. The number of sellers is one of five supply determinants that shift the supply curve when they change. The other four are resource prices, production technology, other prices, and sellers’ expectations.

Detailed explanation-4: -Oligopoly, in which a market is by a small number of firms that together control the majority of the market share. Duopoly, a special case of an oligopoly with two firms.