Shifts in supply

Shifts in supply occurs when the supply curve moves either to the left or the right therefore increasing or decreasing the quantity supplied at the same price level. Things that causes the supply curve to shift to either one direction is when a new technology or product renders the item obsolete or is less useful therefore it shifts away the willingness of consumers from that old item to the new one. Sellers would add more supply or increase the inventory for that new good in their stores if more people are buying it. Besides, sellers would always want to sell more of a good that sells well and fast so that their revenue per a specified time horizon is greater. The result is a decreasing inventory or supply for that old item and a decrease in price because sellers would want to clear out their inventory for that old one to buy more of that new technology or product.

That scenario would also trigger the number of sellers in general willing to supply that old good. If the business is all about competition, they would want to win as much buyers as they can so selling a good that no longer sells well would be a bad idea. When it ripples across a group of sellers, the quantity supplied for that old good would diminish overall and the supply for the new item would be increased due to demand from consumers.


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