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ORIGIN: In a graph, this is point of intersection between the X and Y axes. This intersection point is at the zero values for both axes. This double-zero is the "starting point" for plotting points in the coordinate space established by the two axes.

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Lesson 6: Market Supply | Unit 3: Supply Curve Page: 8 of 19

Topic: Schedule <=PAGE BACK | PAGE NEXT=>

This table is a supply schedule presenting the relationship between supply price and quantity supplied.

Our relationship is between the supply price in the middle column and the quantity of stuffed animals supplied in the right-hand column.

Assumptions:

  • Ceteris paribus factors do not change.
  • Quantities are supplied for a specific time period, such as one year.
Some observations about the supply schedule:
  • First, higher prices go with larger quantities supplied-the law of supply.
  • Second, the prices are minimum values for the given quantities.
  • Third, supply is the whole set of price/quantity pair numbers. Quantity supplied is any single number at the specified price.
  • Fourth, these numbers are hypothetical, presenting a 'what if' relationship.

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SLOPE, SHORT-RUN AGGREGATE SUPPLY CURVE

The positive slope of the short-run aggregate supply curve, reflecting the direct relation between the price level and real production, results for three primary reasons--inflexible resources, frictional and structural unemployment, and purchasing power imbalances.

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