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domyy
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Hello guys,
I have a quick question:
Would a leftward shift of the supply curve result in a shortage?
I have a quick question:
Would a leftward shift of the supply curve result in a shortage?
domyy said:Take a firm selling very few of a particular product and because of it, it´s price is high.
So we´re talking about a deliberate reduction in supply which causes price to increase, in a sense. That results in a leftward shift of the supply curve. Now, can I say there´s a shortage after this shift?
delanis said:There is a new intersection of the supply and demand curves.
That becomes the new equilibrium.
http://www.colorado.edu/Economics/courses/econ2020/section6/gifs/fig62.gif
Increase in price, decrease in quantity
Pyrrhus is not incorrect, but I believe he may be delving too deep into the question.
I'm assuming a simple comparative statics model that one would analyze in a principles class.
A shift in the supply curve in economics refers to a change in the quantity of goods or services that a producer is willing and able to supply at a given price. This can be caused by various factors such as changes in production costs, technology, or government policies.
A shift in the supply curve can affect the market by causing a change in the equilibrium price and quantity. If the supply curve shifts to the left, there will be a decrease in supply which can lead to higher prices and lower quantity. Conversely, a shift to the right can increase supply and result in lower prices and higher quantity.
There are various factors that can cause a shift in the supply curve such as changes in production costs, input prices, technology, expectations, number of producers, and government policies. These factors can impact the supply of goods and services and cause the curve to shift either to the left or right.
A shift in the supply curve is different from a movement along the curve because a shift represents a change in the quantity supplied at a particular price, while a movement along the curve represents a change in quantity supplied due to a change in price. A shift is caused by external factors, while a movement is caused by a change in the price of the product itself.
Yes, a shift in the supply curve can be temporary if it is caused by a short-term factor. For example, a natural disaster may temporarily disrupt the supply of a certain product, causing a shift in the supply curve. However, if the shift is caused by a long-term factor such as a change in technology, it is more likely to be permanent.