Have fun with this interactive Graph!

Change in Supply Impact on Equilibrium

Table Of Contents

  • Moving along the curve
  • Increase in supply
  • Decrease in supply
  • Equilibrium
  • Equilibrium price
  • Equilibrium quantity

A graph at equilibrium will have quantity supplied equaling quantity demanded. As shown below by the graph:


When there is an Increase in Supply, the supply curve shifts to the right. The result of this shift is an Increase inEquilibrium Quantity and a Decrease in Equilbrium price. As shown by the graph below: By Graph 1

When there is an Decrease in Supply,the supply curve shifts to the left. The result of this shift is a Decrease in Equilibrium Quantity and a Increase in Equilibrium price. as shown by the graph above: Graph 2


external image screen-shot-2010-09-22-at-11-43-45.png
external image screen-shot-2010-09-22-at-11-43-45.png

A shift along the curve occurs when it is just the price that has changed, moving the point up or down along the curve.
As shown by the graph to the right:

Economics in the News

Article: http://www.theepochtimes.com/n2/content/view/50768/

external image vnd.openxmlformats-officedocument.wordprocessingml.document.png Economics in the News- Tablet computers.docx


Consider how the following events would change the equilibrium price and quantity in the market specified in the question. To see the answers, highlight the blacked-out text. (Note: you may want to review the Determinants of Supply before taking this quiz)

1. The price of steel significantly decreases. (Automobile market)
Equilibrium price decreases.
Equilibrium supply increases.


    1. http://www.raybromley.com/notes/equilchange.html
    2. http://12congwi.files.wordpress.com/2010/09/screen-shot-2010-09-22-at-11-43-45.png
    3. http://www.eoearth.org/files/120101_120200/120167/250px-Surplus,_Shortage,_and_Equilibrium_graph.gif