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What kind of relationship do we expect to find between market price and desired quantity supplied? Economic concepts are usually much easier to understand if you find an example relevant to your life. Suppose you have a part-time job to help pay your way through school. We can think of the hours you would like to work as your desired quantity supplied, and the hourly wage you earn as the market price.

Ask yourself how many hours each week you would like to work if your job pays US$10 per hour.6 Some people would not be willing to work at all at that wage, others might like to work 15 hours each week, yet others might wish to work 25 hours per week, and so on. What if you could earn $12 per hour? Most people would be willing to work more hours for $12 per hour than for $10 per hour. What about at $20 per hour? If you could earn $200 per hour would you leave school and work full time? Some students certainly would.

Suppose you have a small business baking pies that you sell at your local Farmers' Market. You would probably be willing to bake more pies if you could sell them for $20 each than if you could sell them for $10. We expect that higher market prices will be associated with greater desired quantities supplied, and lower market prices will be associated with smaller desired quantities supplied. The supply relationship is a direct, or positive, relationship with price and desired quantity supplied moving in the same direction.

Supply curves, or relationships, exist for individual suppliers or individual firms or for an entire market, just as with demand. We might be interested in a small clothing manufacturer's supply of socks, or the supply of socks for all the clothing firms in a particular region, or for all such firms in a country, or the world-wide supply of socks. As always, be sure you are clear on what supply relationship is being considered in any supply and demand analysis.

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If you do not live in the U.S., imagine an amount that would be considered a good, but not unrealistic, wage for a part-time job for a typical college student in your country.

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