0455

Supply

Allocation of Resources · 4 question types

Practise

Exam Frequency Analysis

Past paper frequency (2018 to 2024)

This topic accounts for approximately 18% of your exam marks.

stable
Very High
Stable18%

Supply appears alongside demand on virtually every paper; cost changes, technology, and taxes/subsidies are the most tested supply shifters.

Individual supply is the quantity one firm is willing and able to offer at each price. Market supply is the sum of all individual supplies at each price.

To build the market supply curve, the supply from every firm is added horizontally (quantities at each price are added together).

Deriving market supply by horizontal addition: at a price of $1,000 one producer supplies 300 units and another supplies 320 units, so total market supply is 620 units
Source: Individual & Market Supply by Save My Exams

For example, at a price of $1,000 one producer offers 300 units and another offers 320 units; adding these quantities across gives a total market supply of 620 units at that price.