An Individual Supply Curve shows the quantity supplied at each price in which Quantity is plotted along the horizontal axis and Price along the vertical axis.

The upward sloping curve has two significant points to indicate that Producing a larger quantity leads to a high marginal cost, and so you would only supply this quantity at a high price; and Producing low quantity can be done with a low marginal cost, and so you would supply this quantity even at a low price. Text closer to the origin reads, If the price is too low, shut down and don’t produce anything. A flowchart to its right accentuates this concept by explaining the Rational Rule for Sellers. The first component of this chart reads, Sell more of an item if its price is greater than (or equal to) marginal cost. An arrow leads to the second component that reads, Price equals Marginal Cost. A second arrow leads to the third component that reads, Your supply curve is your marginal cost curve. Two other arrows point to the two points on the graph that denotes large and low production quantities. The last arrow leads to the text that reads, Your supply curve is upward sloping because of increasing marginal costs.

A textbox titled Market Supply Curves reads, Add up individual supply curves to get the market supply curve. Remember to account for not only current businesses in the market, but also to consider whether new businesses may enter the market when the price rises, or whether existing business may exit the market when the price falls. The same factors that shape individual supply shape market supply.

The second graph depicts the Movement along the supply curve when the price changes.

The upward sloping line shows two points which are connected by dashed lines to the horizontal and vertical axes. The distance between these points on the curve is labeled. A price rise causes a rise in the quantity supplied. A price cut courses a decline in the quantity supplied. The distance between the first and second points on the vertical axis that connects the points on the curve is labeled A change in the price. The distance between the first and the second points on the horizontal axis is labeled Yields a change in the quantity supplied.

The last graph illustrates shifts in the supply curve when other factors change by comparing three curves. An arrow points from the highest point on the curve in the center to the curve above it. text alongside the curve above reads, A decrease in supply may reflect: 1. Increase in input prices. 2. Decrease in productivity. 3. Other output prices: increase in substitutes-in-production or decrease in complements-in-production. 4. Increase in expected future price. 5. Types of sellers change or decrease in number of sellers.

An increase in supply may reflect: 1. Decrease in input prices; 2. Increase in productivity; 3. Other output prices: Decrease in substitutes-in-production or increase in complements-in-production; 4. Decrease in expected future price; 5. Types of sellers change or increase in number of sellers. The text at the bottom reads, The acronym, I POET can help you remember these five shifters.