how is supply of a commodity affected by the price of related commodities in detail
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As a general rule, price of a commodity and its supply are directly related. It means, as price increases, the quantity supplied of the given commodity also rises and vice-versa. It happens because at higher prices, there are greater chances of making profit. It induces the firm to offer more for sale in the market.
Explanation:
Factors Affecting Supply:
Price of the Commodity: Price is the most important factor influencing the supply of a commodity. ...
Seller's Expectations about the Future Price: ...
Nature of Goods: ...
Natural Conditions: ...
Transport Conditions: ...
Cost of Production: ...
The State of Technology: ...
Government's Policy:
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