What economic concept explains changes in the quantity of goods supplied as market prices vary?

The concept that most accurately explains changes in the quantity of goods supplied as market prices vary is the supply curve. The supply curve graphically represents the relationship between the price of a good and the quantity of that good that producers are willing and able to supply to the market. As prices rise, suppliers typically increase the quantity supplied, reflecting the principle of supply that states higher prices incentivize producers to offer more of a good. Conversely, if prices fall, the quantity supplied tends to decrease since lower prices may not cover production costs or offer adequate returns.

The concept of the law of diminishing returns pertains to production and suggests that as more units of a variable input are added to fixed inputs, the additional output produced from each new unit will eventually decline. Although it influences production decisions, it does not directly explain the changes in quantity supplied with price variations.

The demand schedule, on the other hand, focuses on the relationship between price and the quantity demanded by consumers, rather than the behavior of suppliers. While both supply and demand are fundamental to market dynamics, only the supply curve specifically addresses how supplier behavior changes in response to price fluctuations.

Market structure theory examines how different market configurations—such as perfect competition, monopoly, and oligopoly—affect pricing, output levels