A supply schedule is a tabular representation of various combinations of the price of the product and quantity supply that the sellers are willing to produce and offer for sale in the market during a given time. Therefore, the supply schedule also expresses the relationship between the price of the product and the quantity supply of that product holding the ceteris paribus assumption true. There are two types of supply schedules namely individual and market supply schedule. Here we discuss the derivation of individual and market demand schedules during a given time.
Individual Supply Schedule
An individual supply schedule is defined as the table that shows various quantities of a product that an individual producer or seller or entrepreneur or business firm would offer for sale at different prices during a given time based on ceteris paribus assumption. Therefore, the individual supply schedule states different quantities that a firm would sell at various prices. It can be shown in the table below;
|Price of Good X (in Rs.)||Quantity Supplied of Good X (in Units)||Combinations|
The above table represents the supply schedule of an individual seller. It is clear from this table that one particular producer or a firm is willing to sell 50 units of good X at price per unit Rs.10. If the price increases to Rs.20 per unit, he may willing to sell 100 units of good X. Thus, the individual supply schedule shows that there is a positive relationship between price and quantity supply of good X.
Market Supply Schedule
The table or schedule that shows the supply of the whole market for a commodity at different prices is known as the market supply schedule. In other words, the market supply schedule of a good is the table that shows various quantities of the good that all the firms are willing to supply at each market price during a specific time, assuming other factors affecting supply remain constant. It is an aggregate of the quantities supply by all the individual sellers in a market.
Suppose there are three suppliers (say firm A, firm B, and firm C) in the market. Their supply for onion is presented in the following table. Thus the table below shows a hypothetical market supply schedule.
|Price of Onion (in Rs.)||Supply by firm A||Supply by firm B||Supply by firm C||Market Supply (in kg.)|
The above table shows that the market schedule can be constructed by adding the supply schedule of all the firms. Therefore we find that 600 kg of onion is supplied at the price of Rs. 60 per kg. When there is an increase in the price of onion from Rs. 60 to Rs. 90 per kg then its supply will also increase from 600 kg to 1500 kg in the market. In such a way supply schedule also shows the positive relationship between price and supply other things remain the same.
Therefore supply schedule (whether it is individual or market supply schedule) is a tabular presentation of various combinations of various quantities that producers are willing to produce and sell at various alternative prices during a given time. It states the relationship between price and supply. The supply schedule is used to derive the supply curve of an individual seller and market. The aggregate of individual supply will give us a market supply schedule.