What does the law of supply state?

The law of supply describes the relationship between the price of a good and the quantity of it that producers are willing to offer for sale. According to this law, when the price of a good increases, the quantity supplied also increases. This is because higher prices provide an incentive for producers to produce and sell more of the good, as they can potentially earn greater revenues and profits.

When prices rise, it usually indicates strong demand or a scarcity of the product, prompting suppliers to increase production to meet that demand. Conversely, if prices fall, the incentive to produce decreases because lower prices can lead to reduced profitability, resulting in a decrease in the quantity supplied. This fundamental concept of supply dynamics highlights how prices affect producers' willingness to supply goods and services in the market.

The idea that supply is independent of price changes misrepresents the core principle of the law of supply, as it directly contradicts the fundamental relationship established by the law. Similarly, the assertions that supply decreases as prices decrease or that supply decreases as prices increase go against the basic premise that higher prices lead to greater supply.