Economy: The Law of Supply and Demand

A single firm or company is a producer, all the producers in the market form and industry, and the people places and consumers that an Industry plans to sell their goods is the market. So supply is simply the amount of goods producers, or an industry is willing to sell at a specific prices in a specific time. Subsequently there is a law of supply that reflects a direct relationship between price and quantity supplied. All else being equal the quantity supplied of an item increases as the price of that item increases. Supply curve represents the relationship between the price of the item and the quantity supplied. The Quantity supplied in a market is just the amount that firms are willing to produce and sell now.
A change in quantity supplied is just a movement from one point to another in the supply curve. In opposite, the cause of a change in supply is a change in one the determinants of supply that shifts the curve either to the left or the right. These determinants are the resource prices, technology, taxes and subsidies, producer expectations, and number of sellers. An equilibrium price is required to produce an equilibrium quantity and a price below that amount is referred as quantity supplied of zero no firms that are entering that particular business. If the coefficient of price is greater than zero, as the price of the output goes up, firms wants to produce more of that output. As the price of the output goes up it becomes more appealing for the firms to shift resources into the production of that output. Therefore, the slope of a supply curve is the change in price divided by the change in quantity. The constant in this equation is something less (negative number always) than zero because it requires strictly a positive...

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... quantity of helium supplied has also decreased due to refinery closures and privatization which this is a determinant of supply known as “decreasing number of sellers”, which will cause a rise in the prices of helium. As the number of sellers in this particular market decreases, our supply of helium decreases as well shifting the supply curve. Also, we have a change in a non-price determinant of supply such as the cost of factor production, which equals to a change in supply. This change in supply shifts the supply curve to the left because helium is becoming more difficult to find and the cost of natural resources has increased causing a decrease in the helium supply.

Works Cited

http://www.labmate-online.com/news/chromatography/1/parker_domnick_hunter_ltd/helium_supplies_are_diminishing_and_prices_are_rising/28930/
http://www.youtube.com/watch?v=T7yC-5IDhKM