Supply and supply law

The law of supply states that a higher price leads to a higher quantity supplied and that a lower price leads to a lower quantity supplied.

Supply curves and supply schedules are tools used to summarize the relationship between supply and price.

Supply of goods and services

When economists  talk about supply, they mean the amount of some good or service a producer is willing to supply at each price. Price is what the producer receives for selling one unit of a good or service. A rise in price almost always leads to an increase in the quantity supplied of that good or service, while a fall in price will decrease the quantity supplied. When the price of gasoline rises, for example, it encourages profit-seeking firms to take several actions: expand exploration for oil reserves, drill for more oil, invest in more pipelines and oil tankers to bring the oil to plants where it can be refined into gasoline, build new oil refineries, purchase additional pipelines and trucks to ship the gasoline to gas stations, and open more gas stations or keep existing gas stations open longer hours. Economists call this positive relationship between price and quantity supplied—that a higher price leads to a higher quantity supplied and a lower price leads to a lower quantity supplied—the law of supply. The law of supply assumes that all other variables that affect supply are held constant.

Supply schedule and supply curve

A supply schedule is a table that shows the quantity supplied at each price.

A supply curve is a graph that shows the quantity supplied at each price.

The difference between supply and quantity supplied

In economic terminology, supply is not the same as quantity supplied. When economists refer to supply, they mean the relationship between a range of prices and the quantities supplied at those prices—a relationship that can be illustrated with a supply curve or a supply schedule. When economists refer to quantity supplied, they mean only a certain point on the supply curve, or one quantity on the supply schedule. In short, supply refers to the curve, and quantity supplied refers to a specific point on the curve.

Price and its calculation

Price is the quantity of payment or compensation given by one party to another in return for goods or services. In modern economies, prices are generally expressed in units of some form of currency. (For commodities, they are expressed as currency per unit weight of the commodity, e.g. euros per kilogram.) Although prices could be quoted as quantities of other goods or services this sort of barter exchange is rarely seen.

 

Entrepreuneur and its main functions and types

One who brings resources,labor, material and other assets intocombinations that make their value greater then before and also one who introduceschanges, innovation and new order. Entrepreneurship is viewed as a functioninvolvingidentification and use of opportunitieswhich exist in the market. Entrepreneursbearrisksin converting theideas into action and pursuing opportunities.

Functions of an entrepreneur

Identifying entrepreneurial opportunity

There are many opportunities in the world of business. An entrepreneur senses the opportunities faster than others do. And therefore, keeps his eyes and ears open and apply imagination, creativity and innovativeness in attaining business success.

Turning ideas into action

 An entrepreneur should be capable of turning his ideas into reality. He collects information regarding the ideas, products, practices to suit the demand in the market. Further steps are taken to achieve the goals in the light of the information collected.

Feasibility study

The entrepreneur conducts studies to assess the market feasibility of the proposed product or services. He anticipates problems and assesses quantity, quality, cost and sources of inputs required to run the enterprise. Such a blue print of all the activities is termed as a business plan or a project report.

Resourcing

The entrepreneur needs various resources in terms of money, machine, material, and men to running the enterprise successfully. An essential function of an entrepreneur is to ensure the availability of all these resources.

Setting up of the Enterprise

For setting up an enterprise the entrepreneur may need to fulfill some legal formalities. He also tries to find out a suitable location, design the premises, install machinery and do many other things.

Managing the enterprise

One of the important function of an entrepreneur is to run the enterprise. He has to manage men, material, finance and organize production of goods and services. He has to market each product and service, after ensuring appropriate returns (profits) of the investment.

Growth andDevelopment

Once the enterprise achieves its desired results, the entrepreneur has to explore another higher goal for its proper growth and development. The entrepreneur is not satisfied only with achieving a set goal but constantly strives for achieving excellence.

Types of entrepreneurs

Necessity based /Opportunity based

Profit oriented /Social entrepreneurs

Serial entrepreneurs

Intrapreneurs

First generation / family business

Pinchot (1985) defines an intrapreneur as a "person who focuses on innovation and creativity and who transforms a dream or an idea into a profitable venture, by operating within the organizational environment."