Economics: decreasing and increasing the amount of product supplied for a given price
when the price people are willing to pay for a given quantity is constant, how does decreasing or increasing the amount of product supplied for a given price affect the revenue?
supplying no product into the market, when the price is 0$, seems to offer the best result in terms of revenue.
decreasing supply or stocking the product brings up the equilibrium or market price but we are losing out on the quantity of that product being sold, as the demanded quantity goes down due to the increased price.
increasing the supply brings up the number of sales by driving up the demanded quantity, but the revenue falls down because of the lower price of sales.
but for some products like rice, which is the staple food in Bangladesh, people are willing to pay that extra price that has been brought up by creating a shortage in supply.
therefore, the price people are willing to pay for a given quantity no longer remains constant and the result of which is that the suppliers get to make money from hoarding stuff like rice as the revenue increases with the decrease in supply.