Example 1: The real estate market is excellent and real estate appraisers are making a lot of money. When this happens, more real estate appraisers will enter the market either by activating an inactive license or by taking a qualifying real estate course to become licensed. Conversely, when the market slows, many appraisers will drop out of the industry for lack of work.
Example 2: Builders are making 10-12% profit margins selling speculatively built houses. Demand is so high that prices increase to the point that profit margins increase to 12-15%. Builders will increase productivity to meet demand and new and inactive builders will enter the market to take advantage of the higher margins.