ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The law of supply says that a higher price will induce producers to supply a higher quantity to the market. Because businesses seek to increase revenue, when they expect to receive a higher price for something, they will produce more of it.

Detailed explanation-2: -Several factors can cause market demand for a product or service to change. price and the quantities bought and sold. Supply is the willingness and ability to produce and sell a good or service.

Detailed explanation-3: -Demand is the desire, willingness and ability of consumers to pay a certain price for a product or service at a given period. Businesses can use it to determine the necessary supply and how to price an item.

Detailed explanation-4: -Higher prices give suppliers an incentive to supply more of the product or commodity, assuming their costs aren’t increasing as much. Lower prices result in a cost squeeze that curbs supply. As a result, supply slopes are upwardly sloping from left to right.

Detailed explanation-5: -The law of supply says that when prices rise, companies see more profit potential and increase the supply of goods and services. The law of demand states that as prices rise, customers buy less. Theoretically, a free market will move toward an equilibrium quantity and price where supply and demand intersect.