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Changes in Supply
Part I
Change in Supply
• A change of supply takes place when a new quantity is supplied at every price.– It is NOT the same as a CHANGE IN QUANTITY
SUPPLIED.
• An increase in supply means more is supplied at each price.– The curve shifts to the right.
• A decrease in supply means less is supplied at each price.– The curve shifts to the left.
New Supply Schedule(Increase in Supply)
Price per T-Shirt Original Number of T-Shirts Supplied
New Number of T-Shirts Supplied
$30 350 430
$27 330 406
$24 300 370
$21 240 298
$18 190 238
$15 140 178
$12 70 94
$9 20 34
$6 0 0
New Supply Curve(Increase in Supply)
0
5
1 0
1 5
2 0
2 5
3 0
3 5
0 5 0 1 0 0 1 5 0 2 0 0 2 5 0 3 0 0 3 5 0 4 0 0 4 5 0 5 0 0
Q u a n t i t y o f T - S h i r t s S u p p l i e d
Pri
ce p
er T
-Sh
irt
Comparison
Change in Supply
• New quantity at every price
• New supply schedule
• New supply curve
• Leads to a price change
Change in Quantity Supplied
• New quantity because of a new price
• Move within supply schedule
• Move along supply curve
• Follows a price change
Important Reminder!
• Whenever there is a new quantity supplied:– If the price has not yet changed, it is a
CHANGE IN SUPPLY.– If the price has changed, it is assumed to be a
CHANGE IN QUANTITY SUPPLIED.
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