Q.Explain the important determinants of the supply of a commodity.

Quantity supplied depends on several factors acting together, not on price alone.

The supply function expresses the quantity supplied of a commodity $x$ as depending jointly on several variables:

1. Price of the commodity itself ($P_x$) — the primary determinant; by the Law of Supply, quantity supplied normally moves directly with $P_x$.
2. Cost of production ($C$) — a fall in the cost of inputs (raw materials, labour, capital) raises profitability at a given price and encourages higher output; a rise in cost discourages it.
3. Price of related goods ($P_r$) — if a farmer can grow either wheat or cotton on the same land, a rise in cotton's price may draw resources away from wheat, reducing wheat's supply (competing goods); jointly produced goods (like wheat and straw) tend to move together.
4. State of technology ($Tech$) — an improvement in technology lowers cost or raises output per unit of input, raising supply at every price.
5. Government policy ($G$) — a subsidy lowers the effective cost of production and raises supply; a tax raises effective cost and lowers supply; licensing or quota restrictions can limit supply directly.
6. Price expectations ($E$) — if producers expect the price to rise in future, they may hold back current supply to sell later at the higher expected price (or vice versa).
7. Number of sellers ($N$) — more firms in the industry raises market supply at every price, other things constant.

When the supply schedule or supply curve is drawn to study the effect of $P_x$ alone, every other determinant in this list is held constant (ceteris paribus).

Listing only 'cost of production' and forgetting that a shift in ANY of the other determinants also moves the WHOLE supply curve, not just a point along it — only a change in the good's own price moves supply along the same curve.