Supply : Individual Supply and Market Supply


What is Supply? Not, the total quantity of the commodity available in the market with the seller at any given time. It is the quantity of a commodity that a seller is prepared (or willing) to sell in the market at a given price and at a given period of time.

Supply refers to a schedule showing various quantities of a commodity that the producers are willing to sell at different possible prices of that commodity at a given time.

Supply is Different from Stock

Supply and stock are different from each other. Stock of a commodity refers to the quantity of commodity available with the seller at a point of time. Supply is that part of the stock which is offered for sale corresponding to different possible prices of the commodity.

Supply is just a part of the existing stocks.

A Standard Relation between Price and Supply

Generally, higher the price of the commodity, higher the supply of the commodity, other things remaining unchanged.

Higher the price, higher the quantity supplied, on the assumption that other things do not change.

Individual Supply

It refers to supply of a commodity by an individual firm in the market.

Market Supply

It refers to supply of a commodity by all the firms in the market. If there are only two firms in the market and one of them is selling
50 units and the other is selling 70 units at a given price, the market supply at this given price will be 120 units.