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22 July, 17:10

Why is profit the major determinant of the amount a producer is willing to supply

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  1. 22 July, 18:46
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    There is always a never ending relationship between the supply and the pricing. Every one works to make profit hence if a product has a high price fixed then the producer produces that particular product which is in demand and gain profit. In the market if higher prices are quoted for a product the supply of that particular product increases. If the market price is low for that particular product then the supply will be limited. Hence only the pricing determines whether the goods should be supplied more or less. Price of the product determines the goal of the producer of which product he has to supply then.
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