What Is Linear Supply Function

In its most basic form, a linear supply function looks as follows: y = mx + b. In this case, x and y represent the independent and dependent variables. … That means we have the independent variable (i.e., price) on the y-axis and the dependent variable (i.e., quantity) on the x-axis.

What is a supply function?

The supply function is the mathematical expression of the relationship between supply and those factors that affect the willingness and ability of a supplier to offer goods for sale. An example would be the curve implied by where is the price of the good and is the price of a related good.

What is linear demand function?

A linear demand function is an algebraic formula for calculating demand curves without having to draw a demand function graph. There is no standard way of writing down a demand function, but they usually take on a form such as Qd = a – b(P), where: P is the price. Qd is the quantity demanded.