Supply Analysis — Economics STD 12 Commerce / Arts — Question

1. Variation in supply refers to expansion and contraction of supply which takes place due to change in price.
2. Expansion means more quantity is supplied at a high price while contraction means less quantity is supplied at a lower price.
3. Variation in supply is caused by change in price.
4. Variation is shown by a upward or downward movement on the same supply curve.
   
   

Changes in Supply:

1. Changes in supply refers to increase and decrease in supply which takes place due to changes in factors other than price.
2. Increase in supply means more quantity is supplied at same price and decrease means less quantity supplied at the same price.
3. Changes in supply occurs due to change in factors like.
   (1) change in cost of production
   (2) change in techniques of production
   (3) change in government policy.
   (4) change in goal of producer.
   (5) change in climatic condition etc.
4. Changes in supply is shown by a shift in supply curve to the right or left of the original supply curve.