1.5 Supply

a. Define (using graphs as appropriate) the law of supply. b. Explain (using graphs as appropriate) the relationship between the price of a good or service and the quantity supplied.

• The law of supply states there is a positive relationship between price and quantity supplied, leading to an upward-sloping supply curve.
• Enduring understanding MKT-2: In a competitive market, demand for and supply of a good or service determine the equilibrium price.

Explain (using graphs as appropriate) the determinants of supply.

• Factors that influence producer supply, such as changes in input prices, cause the market supply curve to shift.
• Enduring understanding MKT-2: In a competitive market, demand for and supply of a good or service determine the equilibrium price.