Question

define supply Explain how does the objective of the firm affect the supply

Answer 1

Supply is a fundamental economic concept that describes the total amount of a specific good or service that is available to consumers. Supply can relate to the amount available at a specific price or the amount available across a range of prices if displayed on a graph.

Answer 2

Supply can be defined as the availability of a given product that the suppliers are ready to sell.

Explanation:  

• Supply can be defined as the availability of a given product that the suppliers are ready to sell to the consumers at a specific price at a given period of time.
• The objective of the firm directly affects the supply of products.
• For example, if the objective of the firm is to earn maximum profit the supply would be more as the firm would try to sell more and more products.
• Similarly, when the objective of the firm is to maximize its customer base, it would supply more products and vice versa.
• During the phase of economic challenges, the firms try to reduce their cost of production. At such times the supply is limited.