CONTINUATION OF NOTES ON SUPPLY - I

TIME PERIOD AND SUPPLY

Q. Explain the various time periods in relation to the supply of a commodity.

1.      Market Period

ü  It is a very short period in which the supply of a commodity is fixed. For example, once the vegetables are grown and brought to the market, there cannot be change in the supply of vegetables. 

1.      Short – Run

ü  It is the period in which the supply of a commodity can be increase to some extent. For example, in case of factories, if the producers want to increase production by running the existing plant (machines) for longer hours like two shifts instead of one.

1.      Long – Run

ü  It is the period during which the supply of a commodity can be increased to any extent. For example, if the producer wants to increase the supply of a commodity by a huge amount, he may set up a new factories or plants.