Topics
Linear Supply Function
The supply function can be written in the form of an equation
Qs = c + dP
- Where Qs is quantity supplied
- C = the level of supply independent of price
- P = the market price of the product
- d is the coefficient of price
- Supply for Product X = 10 + 2(P)
If the market price is £20, then Qs= 10 + 20 = 30 units