The reason the market supply curve is upward sloping is that it reflects
the costs of many producers, and they are not all the same. Some are so
good at producing pizzas (low-cost producers) that they would be willing
to accept $5 per pizza; others are less easily able to produce pizzas (high-
cost producers) and hence would need to receive $15 in order to produce
and sell the identical pizza. So the supply curve in Figure 5-5 is made up
of many producers, each with their own willingness to accept. What is
true for the supply of pizza is true for the supply of other products.
For each unit of a product, the price on the market supply curve shows the lowest acceptable
price to some individual firm for selling that unit. This lowest acceptable price reflects the
firm’s additional cost from producing that unit.