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Compute a slope of linear supply function

Can someone please help me to find the slope of linear supply function? The instructor told to provide detailed explanations of the computations, but I do not have any idea.

krishnakrishna asked 2 years ago

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gr8

davidap commented 2 years ago·

Answers

1

Hi Krishna. Good question. Here is my solution.

When price increases, quantity supply increases.
When price decreases, quantity supply decreases.

Slope of linear supply function = ΔQsΔP\frac{\Delta Q^s}{\Delta P} = Change in quantity supplyChange in price\frac{\text{Change in quantity supply}}{\text{Change in price}} = Q2sQ1sP2P1\frac{Q_2^s \, - \, Q_1^s}{P_2 \, - \, P_1}

davidapdavidap answered 2 years ago

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