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Price is perhaps the most obvious determinant of supply. As the price of a firm's output increases, it becomes more attractive to produce that output and firms will want to supply more. Economists refer to the phenomenon that quantity supplied increases as price increases as the law of supply.
Determinants of supply (also known as factors affecting supply) are the factors which influence the quantity of a product or service supplied. We have already learned that price is a major factor affecting the willingness and ability to supply.
Determinants of Supply. Determinants of supply are the factors that affect the supply of a product or service and that cause a shift in the supply curve. However, these factors are held constant (according to the law of supply) to alleviate the effect of the law of supply especially with relation with quantity supplied and the supply price. That is a movement along the same supply curve. When factors other than price changes, supply curve will shift. Here are some determinants of the supply curve.
Supply Determinants Aside from prices, other determinants of supply are resource prices, technology, taxes and subsidies, prices of other goods, price Changes in price simply shifts the amount supplied along the supply curve. Increased prices usually increases profits, which is the main incentive for sellers to produce more. Start studying Determinants of Supply. Learn vocabulary, terms, and more with flashcards, games, and other study tools.