Question

What do you mean by movement along a supply curve ?

Answer 1

Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Demandrefers to how much (quantity) of a product or service is desired by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price; the relationship between price and quantity demanded is known as the demand relationship. Supply represents how much the market can offer. The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price. The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand.

The relationship between demand and supply underlie the forces behind the allocation of resources. In market economy theories, demand and supply theory will allocate resources in the most efficient way possible. How? Let us take a closer look at the law of demand and the law of supply

Answer 2

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Movement along the supply curve is a movement curve which occurs when the price of the good changes and the quantity supplied changes in accordance to the original supply relationship.


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