Q:

What does the law of supply state?

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Quick Answer

In economics, the law of supply states that, considering all aspects equal, the price of a marketed good or service is directly proportional to the quantity supplied. As the price increases, the quantity supplied also increases. Conversely, a decrease in the price results in a decrease in the quantity.

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Full Answer

The law of supply, along with the law of demand, comprise the two fundamental laws in economics. Supply refers to the total amount of produced commodities or services, while demand pertains to the quantity of certain products or services desired by consumers.The law of supply sets constraints on the buyers, while the law of demand restricts the producers.

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Related Questions

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    What is the "law of supply"?

    A:

    The law of supply is an economic concept stating that the price and supply of a good or service are directly elastic to each other. When the price of a good or service increases, the supply of that particular good or service invariably increases, and vice versa. The law of supply states that as price rises, suppliers seek to maximize profits by increasing the quantity supplied.

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    What is screening in economics?

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    What is a firm in economics?

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  • Q:

    What is pricing policy in economics?

    A:

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