Economics · Class 11 Commerce
Ch 4Supply — Class 11 Economics, concept-first.
Having studied demand — the buyer's side of a market — the Gujarat Std 11 Commerce Economics syllabus now turns to supply, the seller's side. In everyday speech 'supply' is sometimes used loosely to mean the total stock a producer happens to hold, but economics gives it a precise meaning: supply is the quantity of a co…
Key concepts
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Supply Function and Determinants of Supply
Supply is the quantity of a commodity a producer is willing and able to offer for sale, always stated at a given price and over a given period of time.
Most relevant Q&A
Chapter contents
The NCERT structure, section by section. Open a section to see its questions, then read the concept-first solution.
Meaning of Supply and the Supply Function
Having studied demand — the buyer's side of a market — the Gujarat Std 11 Commerce Economics syllabus now turns to supply, the seller's side.
Supply Schedule and Supply Curve
A supply schedule is a table listing the various quantities of a commodity a seller is willing and able to offer at different prices, over a given period, other things remaining constant.
The Law of Supply
The Law of Supply states that, other things remaining constant (ceteris paribus), the quantity supplied of a commodity is directly (positively) related to its price — as price rises, quantity supplied…
Exceptions to the Law of Supply
A few real situations depart from the Law of Supply, where quantity supplied does not simply rise with price.
Movement Along vs. Shift of the Supply Curve
It is important to keep two distinct kinds of change on the supply curve separate.
Price Elasticity of Supply — Meaning and Degrees
The Law of Supply only tells us the direction in which quantity supplied moves when price changes; it says nothing about how much.
Measurement of Price Elasticity of Supply
Two methods are commonly used to compute price elasticity of supply.
Factors Determining Elasticity of Supply
Several factors decide how elastic or inelastic the supply of a particular commodity turns out to be:
Market Equilibrium — Price Determination
Demand and supply are studied separately, but in a real market it is the interaction of BOTH forces together that fixes the price actually paid and the quantity actually bought and sold — neither side…
Exercises
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- Q6Distinguish between individual supply and market supply.Free
- Q7Explain the important determinants of the supply of a commodity.Free
- Q8State the Law of Supply. What are the main reasons for a positive relationship between price and quantity supplied?Free
- Q9Explain any three exceptions to the Law of Supply.Preview
- Q10Distinguish between a change in quantity supplied and a change in supply.Preview
- Q11Explain the different degrees of price elasticity of supply.Preview
- Q12Explain the important factors that determine the elasticity of supply of a commodity.Preview
- Q13Explain how equilibrium price is determined in a competitive market. What happens if the government fixes a price above the equilibrium pric…Preview
More questions
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- Example 1The price of a commodity rises from ₹40 to ₹50 per unit, and as a result the quantity supplied rises from 200 units to 250 units per week. C…Free
- Example 2A firm's supply function is $Q_s = 5P$ (a straight line through the origin). Find the price elasticity of supply when price rises from ₹10 t…Free
- Example 3A supply function is given by $Q_s = 3P - 15$. Find the price elasticity of supply at $P = ₹10$, and verify your answer by comparing quantit…Preview
- Example 4A supply function is given by $Q_s = 2P + 10$. Find the price elasticity of supply at $P = ₹15$, and verify your answer using the quantity-a…Preview
- Example 5In a market, the demand function for a commodity is $Q_d = 200 - 4P$ and the supply function is $Q_s = 20 + 6P$. Find the equilibrium price…Preview