Yes, the supply curve does slope upward because of the law of diminishing marginal returns and increasing cost factor in the economy. The law of diminishing returns suggests that as the economy uses more input variable for the production of the goods and services, the output will be produced at a diminishing rate in the economy. Therefore, higher variable inputs demand a higher cost of production. In order to pay the marginal cost of production, higher prices are charged by the producer as more output is produced. Higher the output implies higher the prices will which derives the supply curve upward sloping.