Question

Give reasons for the change in supply.

Answer 1

A change in supply means a shift of the entire supply curve due to non-price factors. Key reasons include changes in input costs, where lower costs increase supply and higher costs reduce it. Technological improvements boost supply, while failures reduce it. An increase in the number of suppliers raises supply, while fewer suppliers reduce it. Expectations of future prices or costs can lead producers to adjust current supply. Government policies like taxes and regulations reduce supply, whereas subsidies increase it. Natural disasters and changes in prices of related goods can also affect supply by disrupting production or shifting resources.