 The law of supply states that if the price of a product increases, the quantity supplied will increase too. And if the price of the product decreases, the quantity supplied will decrease as well, setter is parable. Now, as we did with demand, we will tabulate some data and use it to create a graph to explain this law of supply. Remember, these are just tools to help us understand how supply works. Okay, let's start with our table. Assuming you're the owner of the funky chicken, how many fried chicken pieces are you willing to supply if the price of one piece of fried chicken is say seven round? Any figure will do to start with. So let's start with say 14 pieces. And at six round, well the law says that if the price drops so will the quantity supplied, so 12 pieces. At five round, 10 pieces and so on, using round figures until our table is complete. This clearly confirms that a positive relationship exists between the price and the quantity supplied. In other words, the higher the price, the higher the quantity supplied and the lower the price, the lower the quantity supplied. You'll see later that this relationship is governed by the law of diminishing returns. Now, let's present this data in the form of a graph. We're going to create our first supply curve. As we did with our first demand curve, we'll start by plotting the axes and indicate the origin. Then we'll assign the price of the good P to the vertical axis and the quantity supplied Qs to the horizontal axis. Then the intervals. In this seven equally spaced ones on each axis, followed by the corresponding values from the table. That's one round, two round, three, four, five, six and seven. And two pieces, four pieces, six, eight, ten, twelve and fourteen. Now, we plot the different price quantity supplied combinations. At seven round, fourteen pieces are supplied. At six round, twelve pieces and so on. When we draw a line joining the points and label S, S, we have our first supply curve, indicating the quantities of a good or service that the funky chicken plans to sell at each possible price. A movement from point A to B shows that as the price of the fried chicken increases from four round to six round, the quantity supplied increases two from eight to twelve and an upward movement along the curve takes place. Likewise, if the price drops, a movement down the curve takes place. But how does the supply curve differ from the demand curve for fried chicken pieces? Well, the demand curve shows that a higher price leads to a lower quantity demanded. But with the supply curve, a higher price leads to a higher quantity supplied. So that is the law of supply, which states that the higher the price, the higher the quantity supplied. And the lower the price, the lower the quantity supplied.