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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.

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Presentation on theme: "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."— Presentation transcript:

1 Changes in Supply Part I

2 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.

3 New Supply Schedule (Increase in Supply) Price per T-Shirt Original Number of T- Shirts Supplied New Number of T- Shirts Supplied $30350430 $27330406 $24300370 $21240298 $18190238 $15140178 $127094 $92034 $600

4 New Supply Curve (Increase in Supply)

5 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

6 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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