Principles of Macroeconomics / Unit 2 MAC 0105 short lesson, about 20 seconds
The Law of Supply
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The idea
The law of supply says a higher price raises the quantity supplied, because a higher price covers the cost of producing more and raises the profit from doing so.
In practice
A grower plants more acres when the price rises.
Where people slip
Some things cannot be produced in greater quantity at any price, so the law holds for most goods rather than all.
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