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Unit 3: Supply and Market Equilibrium

The law of supply also assumes that other things are held constant. Other variables, like price of Notes
inputs used in production, technology, producers’ expectations and number of producers in the
market, might change, causing a shift in supply. This will be discussed in the next section.
A supply schedule is a table which lists the possible prices for a good and service and the
corresponding quantity supplied.
Market supply is the summation of all individual supplies at a given price. The market supply
curve is the horizontal sum of the individual supply curve.

Example: From a supply schedule to a supply curve

Let’s see how a supply curve is drawn on the basis of figures given in the supply schedule.
Supply Schedule
Price of X (in `) Quantity Supplied of X (in units)
10 200
20 250
30 300
40 350
50 400

From Supply Schedule to Supply Curve

Task Consider a hypothetical supply schedule for potatoes and draw a supply curve
for potatoes.

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