if the perfectly competitive market supply of pork bellies shifts from qs

If the supply curve is fairly flat, or elastic, the change will be primarily in the equilibrium quantity (see Figure 6.6). Whether a shift in the demand curve results in a greater relative change in the equilibrium price or the equilibrium quantity depends on the shape of the supply curve. So in response to the introduction of a new substitute good where we would expect a leftward shift in the demand curve, both the equilibrium price and quantity for the existing good can be expected to decrease (see Figure 6.5). Likewise, a shift in the demand curve either downward or to the left will usually result in a lower equilibrium price and a lower equilibrium quantity. In the case of a shifting demand curve, since the supply curve is generally upward sloping, a shift of the demand curve either upward or to the right will result in both a higher equilibrium price and equilibrium quantity. Will the equilibrium quantity increase or decrease? Will the equilibrium price increase or decrease? Will the shift in the equilibrium point be more of a change in price or a change in quantity? The examination of the impact of a change on the equilibrium point is known in economics as comparative statics. It is often of interest to determine the impact of a changing factor on the market equilibrium. Since the cost of producing a gallon of gasoline will increase, the marginal cost of gasoline will increase at any level of production and the result will be an upward shift in the supply curve.

As another example, consider the supply curve for gasoline after an increase in the price of crude oil. In the case of the new availability of a close substitute for an existing product, we would expect the demand curve to shift to the left, indicating that at any market price for the existing good, demand will be less than it was prior to introduction of the substitute.

The impact of these persistent changes can be viewed in the context of changes in the behavior of buyers or the operations of sellers that cause a shift in the demand curve or the supply curve, respectively. For example, if a new product becomes available that is a viable substitute for an existing product, there is likely to be either a persistent drop in the quantity consumed of the existing good or a reduction in the market price for the existing good.

In addition to the factors that cause fluctuations in the market equilibrium, some developments may lead to sustained changes in the market equilibrium.

If the perfectly competitive market supply of pork bellies shifts from qs