supply

  

Definition

The total amount of a product (good or service) available for purchase at any specified price.

Supply is determined by: (1) Price: producers will try to obtain the highest possible price whereas the buyers will try to pay the lowest possible price both settling at the equilibrium price where supply equals demand. (2) Cost of inputs: the lower the input price the higher the profit at a price level and more product will be offered at that price. (3) Price of other goods: lower prices of competing goods will reduce the price and the supplier may switch to switch to more profitable products thus reducing the supply.


Use supply in a sentence

  • In the man's bedroom there was a nearly endless supply of chocolate and pizza that he had been saving for years.

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  • When you put out a new product and everyone likes it you must increase your supply to handle the demand.

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  • I increased the supply in order to address the increased demand. There were not enough of the given product so I thought it was necessary.

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