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Frequently Asked Questions—Part 3
By : Lynn Huselton
Plano East Senior High
Plano, TX
Q.What is the difference between a change in quantity supplied and a change in supply?
A.A change in quantity supplied is also known as a movement along the supply curve. A change in quantity supplied results ONLY from a rise or fall in the price of the item graphed.
A change in supply is known as a shift in the supply curve. This shift will be the result of changes in any of the non-price determinants of supply. These non-price determinants include technology, resource prices (costs of production), number of producers, price of other goods, expectations of profits, taxes and subsidies. Any one of the non-price determinants can cause a shift outward or to the right or a shift inward to the left in the supply curve. This shift depicts a new quantity supplied at each and every price and a new supply curve plotted on the graph. Note the two pneumonic devices and the two graphs to enable students to remember the difference between a chance in quantity supplied and a change in supply.
qs =
f (price)
The mnemonic devices read as follows:
A change in quantity supplied is a function of a change in the price of the item graphed.
A producer of backpacks decides to sell his product at a higher price. He raises the price from P1 to P2. This will allow him more money to produce with so he moves along and up his supply curve from point A to point B. There is now a larger quantity supplied. This is a movement along the curve or a change in the quantity supplied.
S
= f (TRNPET)
A change in supply is a function of a change in technology, resource prices, number of producers, prices of other goods, expectations of profits, taxes and subsidies.
A producer of backpacks develops a new technology that makes it possible for him to produce more backpacks at each and every price. This will allow him to shift his production outward to the right. A new supply curve will be constructed to the right of the existing curve. Now at each and every price he can produce more backpacks. This is a shift or a change in supply.
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