Supply
Supply describes the quantities producers are willing and able to offer at different prices over a stated period, holding other relevant conditions constant. A change in the good’s own price ordinarily produces movement along a supply curve; changes in costs, technology, taxes or other conditions can shift the curve. Supply is not simply the amount currently stored in inventory.
Worked example
At a price of $10 suppliers offer 800 units each week; at $12 they offer 1,000, other conditions unchanged. If input costs then rise, they may offer fewer units at each of those prices, shifting supply.
Common mistake
Do not confuse a movement along supply with a shift in supply. State the market, period and relevant unchanged conditions.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | BT | Direct | September 2026–June 2027 |
| FIA | FBT | Direct | September 2026–June 2027 |