Shifts in supply

• Increase in supply

  • If supply increases, the prices will fall.
  • Increase in supply is shown by movement from S to S1.
  • Decrease in price is shown by movemnt from P to P1.
  • Increase in the amt sold in the market is shown by movement from Q to Q1

  
• Decrease in supply

  • When supply dcreases, price increases and qty supplied decreases.
  • Decrease in supply is shown by movement from S1 to S2
  • Increase in price is shown by movement from P to P2