Unformatted text preview: 11/17/05 4:51 PM Page 119 each and every price. Specifically, if we look
at the price $1,000, we see that sellers who
once wanted to sell 4,000 computers now
want to sell 2,000 computers.
Supply increases → Supply curve shifts rightward
Supply decreases → Supply curve shifts leftward What Factors Cause Supply
Curves to Shift?
Supply curves do not shift to the right or
left without cause. They shift because of
changes in several factors. These factors
include a change in resource prices, technology, taxes, subsidies, quotas, number of
sellers, future price, and weather. Resource Prices
Chapter 1 identified four resources, or
factors of production: land, labor, capital,
and entrepreneurship. For now, concentrate
on land, labor, and capital. These resources
are used to produce goods and services.
When resource prices fall, sellers are willing and able to produce and offer to sell
more of the good (the supply curve shifts to
the right). The reason is that it is cheaper to
produce the good. When resource prices
rise, in contrast, sellers are willing and able
to produce and offer to sell less of the good
(the supply curve shifts to t...
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This document was uploaded on 01/16/2014.
- Winter '14