Definition of supply

Definition of Supply

In economics, Supply is the quantity of a good or service that producers are willing and able to offer for sale at different price levels during a specific period. 📈

It is expressed as a function of price:

$S(p) = \text{quantity supplied at price } p$

Key points:

• Higher prices usually encourage producers to supply more.
• Supply is independent of the quantity demanded.
• It reflects producers’ willingness to sell and their ability to produce.

Analogy: The Vending Machine

Think of a vending machine. The more coins you insert (higher price), the more snacks it dispenses (higher quantity supplied). Just like the vending machine, producers respond to higher prices by increasing output.

Supply Curve Example

Notice how the quantity supplied rises as the price increases.

Exam Tip Box

1. When asked to explain supply, start with the definition and emphasize its dependence on price.
2. Use the supply curve to illustrate the upward‑sloping relationship.
3. Remember the key difference: Supply is a function of price, not quantity demanded.
4. Include an example or analogy (e.g., vending machine) to demonstrate understanding.