Supply
Supply is the quantity of a good or service that producers are willing to sell at different prices.
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Supply is the quantity of a good or service that producers are willing to sell at different prices.
- Supply curves slope upwards
- Higher prices encourage more output
- Costs and technology shift supply
🧠 Quick quiz
Three questions. Score 2 or more to complete the topic.
What is Supply?
Within Economics & Civics, which covers money, markets, business, government, law and citizenship: how societies are organised and run, this topic explains Supply. Economics and civics topics explain how money, markets, laws and government affect people, so each topic here pairs a clear definition with a model.
Check that you can explain Supply in your own words and give one example from everyday life. If you can do that, you have understood the core idea.
Understanding Supply helps you read the news critically and weigh up policies, choices and arguments about society.
Supply in detail
Supply is the quantity of a good or service that producers are willing and able to sell at a given price over a period. The law of supply says that as price rises, quantity supplied also rises, because higher prices make production more profitable, giving an upward-sloping supply curve.
A change in price causes a movement along the curve, while other factors shift the curve: costs of production (wages, raw materials), technology, taxes and subsidies, the number of sellers and weather for farm products. A rise in supply shifts the curve to the right. Supply decisions help firms decide what and how much to produce.
How the interactive helps you understand Supply
Watch the supply model in the interactive. Use any sliders or buttons it offers to change the values and see how the supply model responds.
Before you change anything, predict the result. Then change one value at a time and check whether your prediction was right. This is a quick way to build a correct mental model of Supply.
Real-life uses and examples
- Give a balanced answer about Supply by considering more than one point of view.
- Relate Supply to a news story about prices, jobs, elections or government spending.
- Use Supply to weigh up the pros and costs of a policy or decision.
Common mistakes to avoid
- Confusing a short-term effect with a long-term one.
- Giving an opinion without evidence or a clear economic or civic reason.
- Learning the definition without testing it. Use the quiz and the interactive to check that you can apply the idea.
Frequently asked questions about Supply
What is Supply?
Supply is the quantity of a good or service that producers are willing to sell at different prices.
What are the most important points about Supply?
The main points are: Supply curves slope upwards; Higher prices encourage more output; Costs and technology shift supply.
Why is Supply useful?
Understanding Supply helps you read the news critically and weigh up policies, choices and arguments about society.
How can I practise Supply?
Open the interactive at the top of this page and change the controls one at a time. Predict the result before each change, then take the three-question quiz. A score of two or more marks the topic as complete on this device.
Which topics are related to Supply?
Related topics in Economics & Civics include Competition and Monopoly, Banks and Saving, Insurance and Risk.