Producer Behaviour and Supply Test - 2

It is the cost of self supplied factors.

For eg. if you are working in a restaurant at a salary of Rs. 50,000. and you receive an offer to work for a news channel which will pay you Rs. 30,000 and another offer to work in a administrative office which will offer you 40,000 Rs. 

In this case the opportunity cost of working in the restaurant is the cost of the next best alternative foregone, which is the offer of Rs. 40,000 for working in a office.

It refers to the amount received by a firm from the sale of a given quantity of a commodity in the market.

According to the law of supply there is a direct relationship between the price of the commodity and the qty supplied. If the price increases qty supplied increases and vice versa.

It is the tabular statement showing various quantities of a commodity that all the producers are willing to sell at various levels of price during a given period of time.

It is the locus of all the points showing various quantities of a commodity that a producer is willing to sell at various levels of price.

It points to the reaction of the sellers to a particular change in the price of tbe commodity.

In this schedule we can see that as the price of the commodity increases , its supply also increases

payments made to hired labour, rented land or buildig, interest paid on loan taken from third party are all explicit factor payment as cash is actually going out from the business.