Explain Law of Supply

Law of supply: According to the law of supply other things being equal when the price of commodity roses, the quantity supply of it in the market increase and when the price of the commodity falls its quantity supply of it in the market decreases.

Thus the law of supply shows the direct relationship between price of a commodity and its quantity supply, other things remaining the same.

According to S.E. Thomas “A rise in price fends to increase supply and fall in price fends to reduce it.”

For instances, if the price of rice increases sellers will supply on rice. On the other hand, if the price of rice falls, sellers will offer lower quantity of rice for sell. The law of supply can illustrated through a supply schedule and through a supply curve.

Supply Schedule: A detail account of the supply of any commodity at a given time at different price as known as the supply schedule. It shows the following table:-

Price	Quantity
10 tk	500 units
20tk	1000 units
30 tk	1500 units

Table: Supply Schedule

It is clear from the supply schedule that when price is 10 tk quantity supplied 500 units. When the price is 20 tk, the quantity supplied 1000 units and when the price is 30 tk at that time quantity supplied 1500 units. This tendency of the producer to supply more unites at a higher price. This is nature of law of supply.