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Question

Will the seller always be ready to sell more of a commodity at a higher price in the market?

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Solution

A seller generally tends to sell more of a commodity at a higher price because higher price implies higher profit. Accordingly, the seller is induced to produce more and sell more. But, it is not always true.
In a situation, when he expects a rise in the price of the commodity in the near future, he may decide to hold the stock for future sale. Accordingly, his current supply will be reduced.
Thus, we state that the positive relationship between price and quantity supplied of a commodity holds good only on the assumption that other determinants of supply (other than own price of the commodity) do not change.

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