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Where supply homework answers are not difficult to find, the trying work, in this case, is to zero on those import topic aspects that are actually important. We think that any random educative website can give the solution, but in reality, it isn’t.
Although a good homework help manual on this subject can provide an insight which important, I have shared some of the important facets of this topic that can provide you guidance.
- Defining the concept of supply
This is one of the basic economic concepts highlighting the amount in totality to produce a certain number of services and goods so that more people can avail those. One of the potent trends in modern economy, it states how a particular service or commodity has its specific patterns regarding preference, utility and price.
Supply is only possible from producers, if the demand is higher. In case the demand level stays constant, the rate of supply will augment. This movement will continue to a particular point until no possible change can be seen and both the level of demand and supply comes to an equilibrium position.
- How did it come to existence?
In finance and economics, association of supply is mainly with demand. In the year 1890, Alfred Marshal represented the data graphically, regarding supply curve. Based on the principle of economics, law of supply states the requirement and methodology of interaction that can be seen between demand and supply of commodities. The assumption regarding market competition is basically dependent on capitalist structure.
- Expressing the theory of supply
While writing supply homework answers, it is imperative for you to highlight theory of supply. As per this law, there are 3 possible causes, explaining the movement of supply curve to right from left.
- Incoming of entrants (new) in market
When total supply sees a hike because of higher prices, this causes a growth in incentives. The result of this is encouraging more business houses to enter in the market.
- Cost and production
Production cost of a company has a possibility to grow with the expansion of output. In order to cover this additional costing, requirement of a higher price is imperative.
- Motive behind profit
A hike in demand is seen with the increase in market prices. This serves its purpose in helping output to grow and offer higher yields to companies.
- Various concepts and terminologies of supply
Money supply and supply chain finance are 2 of the most important terminologies related to supply. The former term states about liquid assets and currency stocks that are available in a country. On the basis of this available funds, policy formulation, its regulation as well as supply evaluation are made by economists. The latter term talks about the transaction links that takes place between financing institutions, sellers and buyers.
- Vital points regarding supply change
Some of the vital points that you can include as your supply homework answers are as follows:
- Ceteris paribus assumption
This is a Latin phrase which expresses its meaning to be equal when considering other things in supply. As per this assumption, the highlighting factor in this respect is related to the relationship between supply curve and demand curve. The factor on which the change takes place is mainly dependent on 2 factors. Those 2 comprises of price (denoted on vertical axis) and quantity (denoted on horizontal axis).
As per this supposition, the relevant factor that changes is only the price, and it has no relation with any of the economic factors. If the variables are not considered equivalent, existence of law of demand and supply will not be possible.
- Shift in supply curve
Certain relevant factors related to cost of production and the changes on it can initiate a shift in the entire supply curve. This movement can be on the right or left of the supply curve graph, causing the supply quantity to be lower or higher at a particular or designated price.
- Factors which influence supply
Apart from the points highlighted above, there are also 3 other factors that play an important role in influencing supply.
- Latest technology
A shift in the supply curve can be easily witnessed when a company introduces latest technology. This change is mainly because of lower costing associated with it. In addition to it, this shift in the right side becomes one of the chief reasons for merchandise or service production to be manufactured in larger quantity.
- Natural conditions
You can highlight one of the recent examples regarding sudden drop in supply in your supply homework answers. Where Manchurian Plain is considered China’s highest soybean, corn, and wheat producer; a severe drought in 2014 made their situation deplorable. This showcases lower supply quantity even if the amount is increased for higher supply.
Effect in supply via government policies can be seen in supply curve. This comes to light in the form of subsidies, regulations, and taxes that influences production cost. When production cost is low, supply quantity can be seen increasing.
- Suppliers
If consideration is regarding individual supply curves, then its horizontal summation highlights the supply curve of the market. With the increase in supplier numbers in the market, the possible shift in supply curve can be a major factor initiating a stark drop in prices.
- Does supply really influenced by production cost?
As you have already seen in the above section, influence of production cost is visible in supply curve. This change is mainly because of the rise and fall of product quantity prices. Such change acts as an economically relevant factor in shifting the curve in supply graph.
These are some of the quintessential yet important details about supply. Aside to these supply homework answers, you can find more info from a trusted professional website dealing with homework help solutions.
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