Supply analysis Its related with the behavior of producer. Schedules of qty of commodities dt is offered for sale Supply is different than stock Stock is totl volume of commodities brought into market for sale. “amt of commodity or service that producers are wlling & able to offer far a sale at a given price at a particular period of time or any period of time Law of supply Other thins being same, as price of a commodity rises ,its supply is extended & price falls, its supply is contracted. Supply schedule Fig…. Supply curve Fig… Assumptions of No of firms in mkt same Production sld not change Mkt prices of related goods sld not change Mtav same No other inputs sld b available Features of.. Direct r/n b/n qty supplied & price Supply is dependent price is independent Not a universal law cUrve slopes upwards from left o right Exceptions to.. Price rise or low supply has not influence Curve slopes backwards Ex subsistence farming When seller badly needs money Not interested in max profits Auction sale exceptional Get rid of goods Determinants of supply Fig… Supply function Qx = F(Px Py PI Pi T M T ELASTICITY OF SUPPLY Response of supply to change in the price of a commodity Pe = % change in qty supplied % change in price Table…

1. SUPPLY ANALYSIS

2. SUPPLY ANALYSIS
 Its related with the behavior of producer.
 Schedules of qty of commodities that is
offered for sale
 Supply is different than stock
 d/f b/n stock and supply
 Stock is total volume of commodities brought
into market for sale.

3. SUPPLY ANALYSIS
Def :- “amt of commodity or service that
producers are willing & able to offer far a sale
at a given price at a particular period of time
or any period of time”.

4. LAW OF SUPPLY
 Other thins being same, as price of a
commodity rises ,its supply is extended &
price falls, its supply is contracted.

5. SUPPLY SCHEDULE

6. SUPPLY CURVE

7. ASSUMPTIONS LAW OF SUPPLY
 Number of firms in mkt same
 Production schedule sld not change
 Mkt prices of related goods sld not change
 Income taste preferences sld be same
 No other inputs sld b available

8. FEATURES LAW OF SUPPLY
 Direct r/n b/n qty supplied & price
 Supply is dependent , where as price is
independent
 Not a universal law
 curves slopes upwards from left o right

9. EXCEPTIONS LAW OF SUPPLY
 Price rise or low supply has not influence
 Curve slopes backwards
 Ex subsistence farming
 When seller badly needs money
 Not interested in max profits
 Auction sale exceptional
 To Get rid of goods

10. DETERMINANTS OF SUPPLY

11. SUPPLY FUNCTION
Qx = F(Px ,Py, Pi, T. M. T)
Price of good x to price of good y
Inputs
Technology
Time period

12. ELASTICITY OF SUPPLY
Response of supply to change in the price of a
commodity
Thus
Es = % change in qty supplied
% change in price

13. Type Qty Supply Price Es Line
Perfectly
inelastic
No 0 Horizontal
Perfectly
elastic ∞ Small
∞ Vertical
Unitary Equal equals 1 St.line
Relatively
elastic
Large Change >1 45 angled
Relatively
inelastic
Change Less than <1 steeper

14. ELASTICITY OF SUPPLY
Perfectly inelastic
In case of figure A
No change in supply & hence the supply curve
is perfectly inelastic, thus Es=0

16. ELASTICITY OF SUPPLY
Perfectly elastic
In case of figure B
Even for a small change in price there will
infinite change in supply & hence it is
perfectly elastic Es=∞

18. ELASTICITY OF SUPPLY
Unitary elastic
In case of figure C
The change in price is equal to change in qty
supplied hence it is unitary ED=1

20. ELASTICITY OF SUPPLY
Relatively elastic
In case of figure D
The change in price is Smaller than change in
qty supplied & hence it is relatively elastic
Es > 1

22. ELASTICITY OF SUPPLY
Relatively inelastic
In case of figure E
The change in QTY supplied is lesser than the
change in price it is relatively elastic
Es < 1

24.  In the short period, the supply of a
commodity is inelastic
 In long run it is elastic
 In case of agricultural commodities supply is
inelastic
 In case of industrial goods it is elastic