S&D Krispe Kreme

Below is a SUPPLY SCHEDULE showing the quantity of chocolate glazed doughnuts a business is willing to SELL at various prices during a given time period.

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Price per Doughnut     Quantity Supplied 
$.60       300 
.50        250 
.40        200
.30        150
.20          100 
Now, let’s say that the cost of flour, sugar, and chocolate used in making doughnuts FALLS. Krispy Kreme will be willing to produce more doughnuts, so there will be an INCREASE in SUPPLY, and there will be a whole new supply schedule. 
INCREASED SUPPLY SCHEDULE II 
Price per Doughnut    Quantity Supplied 
$.60       400  
.50        350 
.40       300 
.20        250     
.30       200 
SUPPLY 
Supply increases >
Supply decreases
2. This is called a DIRECT RELATIONSHIP. Why? Increase in price creates a decrease in supply and vise versa
3. If the sugar cane crop was destroyed and cost of sugar increased sharply, the cost of producing 
doughnuts would increase, the supply might