1. Chapter 6 Section 2

2.  Shortage – firms will raise prices ◦ Quantity supplied will rise; quantity demanded will fall; until both are equal  Surplus – firms will lower prices ◦ Quantity supplied will fall; quantity demanded will rise; until both are equal

3.  Technology, Government (Taxes and Subsidies), and change in price of input  What Happens to the Supply Curve  What happens with a decrease in supply?

4.  The “Shortage” Problem ◦ usually the new must-buy item  What happens to the Supply Curve  What happens in a decrease in demand?