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THEORY OF PRICE - Coggle Diagram

- - - - Markets do not stay statistic
        
        If price of stationery goods are rises, the profitability of producing stationery goods increases. Firms can now make super-normal profit because the marginal revenue is greater than marginal cost
      - Higher price acts as an incentive for firms to try and increas supply
        
        At a low price, it was not worth drilling for stationery goods in the companies and schools, but with the higher price, it is an incentive
  - - - As the supply of stationery goods falls, the price rises
      - In the short-term, demand is price inelastic and so there is only a small fall in demand