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3. Change in Supply vs Change in Quantity Supplied
  A. Change in Supply
 

A change in supply is caused by factors other than the price of the product.

Graphically, it involves a shift of the supply curve, which implies greater/smaller quantities supplied than before at the original prices.

 
 
A decrease in supply
  • Suppose there is a decrease in supply, shifting the supply curve from S1 to S1.
  • At the price P1, the quantity supplied will decrease from Q1 to Q2.
A decrease in supply
 
 
 
A increase in supply
  • Suppose there is an increase in supply, shifting the supply curve from S1 to S2.
  • At the price P1, the quantity supplied will then increase from Q1 to Q2.
A increase in supply
 
 
  B. Change in quantity supplied
 

A change in quantity supplied refers to a change in quantity offered for sale as a result of a change in the price of the product.

Graphically, there is no shifting of supply curve, the change is represented by "a movement along the supply curve" .

 
  A change in quantity supplied - - "a movement along a supply curve".
A change in quantity supplied - - "a movement along a supply curve".
 
  • Suppose the price of a good increases from P1 to P2.
  • The quantity supplied will increase from Q1 to Q2.
 
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