Answer the following questions: What are the exceptions to the law of supply?

Answer the following questions:

What are the exceptions to the law of supply?

Answer: The following are the exceptions to the law of supply.

i. Cash requirement - If the seller wants cash immediately, he may be willing to supply more, even at a lower price violating the law of supply.

ii. Agricultural sector - The law does not apply to the agricultural products, due to high degree of uncertainty attached to them. For example, whatever be the price, the supply of wheat cannot be increased in the short run, in the event of any natural calamity or crop failure.

iii. Expectations about the future - Quantity supplied by a seller depends on the price expected by the seller to prevail in the market. Thus, if a seller expects that the price will fall in the future, he might increase the quantity supplied at a lower price, thus violating the law of demand.

iv. Rare articles- Goods, like artistic goods (such as paintings) have limited availability. Accordingly, they do not follow the law of supply.