Movements vs Shifts of Supply Curve
Supply
AO2·AO4·Diagram required
Syllabus requirement
Movement along the curve due to price changes versus shifts due to non-price determinants.
Assessment objectives
AO2 Application and AnalysisAO4 Use of Appropriate Skills
Required diagram: A movement along the supply curve occurs when the price of the good changes, leading to a change in quantity supplied. A *shift* of the supply curve happens when a non-price determinant (like production costs, technology, number of sellers, or expectations) changes, causing the entire curve to move left (decrease in supply) or right (increase in supply).
Summary
This topic explains the difference between movements along a supply curve and shifts of the supply curve. Movements along the curve (expansions and contractions) happen when the good's price changes and quantity supplied changes; shifts occur when non-price determinants (for example production costs, technology, number of firms, taxes, subsidies, expectations, or related products) change, causing the entire supply curve to move left or right. Understanding this distinction is essential for analysing how markets respond to price signals versus other economic events.
