Question

Draw the supply curve of a perishable commodity. Give a reason for the shape of the supply curve.

Answer 1

The market period is a brief time frame during which supply is fixed. The stock of the already-produced commodity is the maximum supply during the market time. The supply of perishable foods is one example of this. For example, no matter the price, the supply of vegetables cannot be altered once they have been harvested and delivered to the vegetable market. As a result, businesses are unable to adapt their output to price changes within the market time. Consequently, a company’s or industry’s supply curve is vertical, as shown by s₁ s₁ in the fig.