BIZ SPONZORS
popular biz reading
Marketing Mix: Promotion
Employee Turnover
Marketing Mix: Price
Planning and Organizing
Maslow's Hierarchy of Needs
Key Performance Indicators
Sustainable Competitive Advantage
Ishikawa Fishbone Diagram
Price Determination
Supply Chain Concept
Employee Induction
3 Basic Finance Statements
Sales Forecast Accuracy
FMCG Sales Boosting
OTIF - On Time In Full
Merchandising at the Point of Sales
Promotion Mix: Advertising
Employee Motivation
Porter's 5 Forces
CHECK ON BIZ DEVELOPMENT
biz sponsors
BrainCast Relaxation
Advertise on Biz Development
My BrainCast
Energy Booster
Twitter
biz archive
2012
2011
2010
2009
2008
2007

My Introspective

by Laurus Nobilis
My BrainCast

Sales Force

Aggregate Supply of Products (B)

 

Aggregate Supply

 

What is aggregate supply? What are the factors that makes a shift of aggregate supply curve?

 

Posted: Oct 2009


Aggregate SupplyAggregate Supply a Product (service) is the quantity of products (services) that sellers are willing and able to sell. Offered quantity is positively correlated with good price. The law of Supply says: with the rise of prices of a good,  the supply is growing as well, and vice versa, assuming that other factors constant.

In order to determine how the market works, it is necessary to determine the market supply. The market supply is the sum of all individual bids for certain goods or service. Market supply curve represents the horizontal sum up all the individual bids. 

The Supply curve is not static. It can change, depending of various factors. The shift of supply can happen during the change of input prices, change of technology and number of suppliers.

Shift of Aggregate Supply

For example, the new category of product is making suppliers to produce a large quantities of the new product. Since the product is new the interest is high, the price is high as well. Therefore the supply curve moves to T1.

Later on, the the input prices goes down and technology is getting more efficient, therefore the supply curve returns to the initial. Finally, as more competitors are trying to grab the part of the market, the prices are further dropping down, shifting the curve of supply to T2.  

 
 
Recommended reading:

Aggregate Demand of Market  
Market Balance: Demand and Supply Equilibrium  
Case Study: Shift of Supply and Demand  

 

 

 

My BrainCast Self Improvement
blog comments powered by Disqus
 
     
My BrainCast My BrainCast energy Booster My Braincast Deep Sleep
My BrainCast Mandala Meditation My BrainCast Relaxation
my-braincast