Supply is the other side of the LOSAD coin. Supply factors are those that impact on a company's ability and willingness to produce a product and put it on the market for sale. A check of the supply factors in Chapter 3 shows that the number of sellers, input prices, technology, taxes and subsidies, prices of related outputs, and expectations about the future are among the most important determinants of supply.
As we did with demand, we need to distinguish between a change in supply (supply shift) and a change in the quantity supplied (movement along a given supply).
This is an important distinction for discussion purposes. Further, it is not enough to be able to simply identify the factors that affect supply. It is necessary to go beyond that and speculate what are the impacts of changes in these determinants on supply, and, ultimately, on prices. You have all been asked to think of a product that you might want to produce. How would the factors named above influence your choice? How would changes in some of the above determinants impact your profitability?