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Definition of 'Law Of Supply'
A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity of goods or services offered by suppliers increases and vice versa.
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Investopedia explains 'Law Of Supply'
As the price of a good increases, suppliers will attempt to maximize profits by increasing the quantity of the product sold.
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Learn economics principles such as the relationship of supply and demand, elasticity, utility, and more!
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Does the amount of goods and services produced set the pace for economic growth? Here are the arguments.
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