(i) Price of the Commodity: There is a direct relationship between price of a commodity and its supply. Generally, higher the price, higher the quantity supplied, and lower the price, lower the quantity supplied.
(ii) Price of Related Goods: The supply of a good depends upon the price of related goods. For example: Consider a firm selling tea. If price of coffee rises in the market, the firm will be willing to sell less tea at its existing price. Or, it will be willing to sell the same quantity only at a higher price.
(iii) Number of Firms: Market supply of a commodity depends upon number of firms in the market. If there is increase in the number of firms market supply will increase and if the number of firms decreases market supply will fall.
(iv) Goal of the Firm: If goal of the firm is to maximise profits, more quantity of the commodity will be offered at a higher price. On the other hand, if goal of the firm is to maximise sales (or maximise output or employment) more will be supplied even at the same price.
