… a core concept in Economic Analysis
The supply curve shows how much of a good suppliers are willing to supply at different prices. (See Alex Tabarrok, reference below and video to right.)
In a supplementary MRU lesson (reference below and video below) Tabarrok elaborates with a slightly longer definition:
“A supply curve is a function that shows the quantity supplied at different prices. The quantity supplied is the quantity that producers are willing and able to sell at a particular price.”
He notes that one can read supply curves either horizontally or vertically, depending on the problem to be analyzed, as illustrated below:
MRU practice questions
See http://www.mruniversity.com/supply-curve-definition-example-practice-questions, and http://www.mruniversity.com/node/179640, accessed 20 April 2016.
- Along a supply curve, if the price of oil falls, what will happen to the quantity of oil supplied?
- Michael is an economist. He loves being an economist so much that he would do it for a living even if he only earned $30,000 per year. Instead, he earns $80,000 per year. (Note: This is the average salary of new economists with a Ph.D. degree.) How much producer surplus does Michael enjoy?
Alex Tabarrok, The Supply Curve, Marginal Revolution University, at http://www.mruniversity.com/courses/principles-economics-microeconomics/supply-curve-definition-example, accessed 19 April 2016.
Alex Tabarrok, A Deeper Look at the Supply Curve, Marginal Revolution University, at http://www.mruniversity.com/courses/principles-economics-microeconomics/demand-curve-consumer-surplus-definition, accessed 19 April 2016.
Atlas topic and subject
Page created by: Ian Clark, last modified on 20 April 2016.
Image: Minute 0.21 of MRU Video, at http://www.mruniversity.com/courses/principles-economics-microeconomics/supply-curve-definition-example, accessed 20 April 2016.