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Quantity Supplied

What is 'Quantity Supplied'

In economics, quantity supplied describes the amount of goods or services that are supplied at a given market price. How supply changes in response to changes in prices is called the price elasticity of supply. The quantity supplied depends on the price level, and the price can be set by either a governing body by using price ceilings or floors, or by regular market forces.

Explaining 'Quantity Supplied'

If a price ceiling is set, suppliers are forced to provide a good or service, no matter the cost of production. Generally, suppliers are willing to supply more of a good when its price increases and less of a good when its price decreases.

Suppliers' Control Over Quantity Supplied

Ideally, suppliers want to charge high prices and sell large amounts of goods to maximize profits. While suppliers can usually control the amount of goods available on the market, they do not control the demand for goods at different prices. As long as market forces are allowed to run freely without regulation, consumers also have control over how goods sell at given prices. Consumers ideally want to be able to satisfy their demand for products at the lowest price possible.

Determining Quantity Supplied Under Regular Market Conditions

The optimal quantity supplied is the quantity that consumers are willing to buy all of the quantity supplied. To determine this quantity, known supply and demand curves are plotted on the same graph. On the supply and demand graphs, quantity is in on the x-axis and demand on the y-axis.

Market Forces

Theoretically, markets should strive for equilibrium, but there are many forces that pull them away from this point. Many markets do not operate freely; instead, they face external forces, such as government rules and regulations that influence how much of a product suppliers have to provide.


Further Reading


An empirical comparison of published replication research in accounting, economics, finance, management, and marketing
www.sciencedirect.com [PDF]
… frequencies of replications and extensions in the accounting, economics, finance, management, and marketing disciplines. The nature of the principal data types (primary or second- ary) used by the five disciplines might also have a bearing on the quantity of published …

Proprietary public finance and economic welfareProprietary public finance and economic welfare
www.sciencedirect.com [PDF]
… frequencies of replications and extensions in the accounting, economics, finance, management, and marketing disciplines. The nature of the principal data types (primary or second- ary) used by the five disciplines might also have a bearing on the quantity of published …

Water pricing and full cost recovery of water services: economic incentive or instrument of public finance?Water pricing and full cost recovery of water services: economic incentive or instrument of public finance?
iwaponline.com [PDF]
… frequencies of replications and extensions in the accounting, economics, finance, management, and marketing disciplines. The nature of the principal data types (primary or second- ary) used by the five disciplines might also have a bearing on the quantity of published …

Deposit rate-setting, risk aversion, and the theory of depository financial intermediariesDeposit rate-setting, risk aversion, and the theory of depository financial intermediaries
www.jstor.org [PDF]
… frequencies of replications and extensions in the accounting, economics, finance, management, and marketing disciplines. The nature of the principal data types (primary or second- ary) used by the five disciplines might also have a bearing on the quantity of published …

Finance and economic growth-a review of theory and the available evidenceFinance and economic growth-a review of theory and the available evidence
ideas.repec.org [PDF]
… frequencies of replications and extensions in the accounting, economics, finance, management, and marketing disciplines. The nature of the principal data types (primary or second- ary) used by the five disciplines might also have a bearing on the quantity of published …



Q&A About Quantity Supplied


What do consumers ideally want from suppliers?

Consumers ideally want to be able to satisfy their demand for products at the lowest possible price.

What does quantity supplied describe?

Quantity supplied describes the amount of goods or services that are supplied at a given market price.

Is it possible for markets not operating freely ?

Yes , many markets do not operate freely .

If so , what are some examples ?

Some examples include minimum wage laws , tariffs , quotas etc .

How do suppliers want to charge for their products?

Suppliers want to charge high prices and sell large amounts of goods to maximize profits.

How do you graphically depict supply?

Supply is typically plotted as a curve with quantity supplied (the dependent variable) plotted horizontally and price (the independent variable) plotted vertically.

In what type of market does supply take place?

Supply takes place in goods markets.

Where is supply typically found in an economy?

Supply can be found in currency, time, raw materials or any other scarce or valuable object that can be provided to another agent. This is often fairly abstract. For example in the case of time, supply is not transferred from one agent to another but one agent may offer some other resource in exchange for the first spending time doing something.

How is supply affected by changes in prices?

Supply is affected by changes in prices through the price elasticity of supply.

Who sets the price floor and ceiling?

Price floors and ceilings can be set by either a governing body or regular market forces.

What is optimal quantity supplied?

The optimal quantity supplied is the quantity that consumers are willing to buy all of the quantity supplied. To determine this, we plot both supply and demand curves on one graph with quantity on the x-axis and demand on y-axis. We then find where these two lines intersect, which indicates equilibrium between supply and demand. This point should theoretically be reached if markets were allowed to operate freely without external forces such as government rules and regulations influencing how much of a product suppliers have to provide."

Are there any factors that pull markets away from equilibrium points ?

Yes , many markets face external forces such as government rules and regulations .

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