lec 3 - Chapter 2a-b: Supply and Demand 2. b. Supply Just...

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Chapter 2a-b: Supply and Demand 2. b. Supply Just like demand, there are factors that determine the quantity of a good or service sellers are willing to offer for sale. Price is one factor, all other things unchanged. A higher price is likely to induce a seller to offer a greater quantity of a good or service. Production cost is another determinant, as well as the number of sellers in the market. Also like demand, there are specific terms used when talking about supply and the following provides an outline along with examples of the terms. Quantity Supplied The quantity sellers are willing to sell at a particular price during a particular period, all other things unchanged. Using movie tickets as an example, a movie theater is willing to sell 100,000 tickets at $8. At a price of $4, they are only willing to part with 75,000 tickets. Conversely, at a price of $12, they will sell 125,000 tickets. The quantity supplied is greatest at the price of $12 per ticket and lowest at the price of $4 per ticket. Supply Schedule A table that shows quantities supplied at different prices during a particular period, all other things unchanged. Figure 2b-1 gives a supply schedule for the quantities of coffee that will be supplied per month at various prices. At a price of $4 per pound, producers are willing to supply 15 million pounds of coffee per month. A higher price of $6 per pound induces sellers to supply a greater quantity at 25 million pounds of coffee
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This note was uploaded on 10/03/2011 for the course ECON 1A taught by Professor Cowen during the Winter '09 term at UCLA.

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lec 3 - Chapter 2a-b: Supply and Demand 2. b. Supply Just...

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