1. Law of Supply
The Law of Supply states that when the price of a product increases, its quantity supplied usually increases. When the price decreases, its quantity supplied usually decreases.
This happens when other factors remain the same.
Example: If pen prices rise, sellers may offer more pens because they can earn more money.
2. Numerical Example
| Price per Pen ($) | Quantity Supplied |
|---|---|
| 1 | 10 pens |
| 2 | 20 pens |
| 3 | 40 pens |
| 4 | 70 pens |
| 5 | 110 pens |
3. Explanation
- At $1, the seller offers 10 pens.
- At $2, the seller offers 20 pens.
- At $3, the seller offers 40 pens.
- At $4, the seller offers 70 pens.
- At $5, the seller offers 110 pens.
As the price rises from $1 to $5, the quantity supplied rises from 10 to 110 pens.
The seller is encouraged to offer more pens because a higher price can bring more profit.
Conclusion: Price and quantity supplied have a direct relationship, assuming other factors remain constant.
