8o 



POLITICAL ECONOMY 



constant, yet the market price of the commodity may vary im- 

 mensely, as men's minds vary. 



Assuming the two limits to be fixed and constant, the follow- 

 ing additional corollaries flow from the first law : 



B. If the supply at a price increases at prices near the 

 market price, as shown in the upper dotted line (Fig. 3), prices 

 fall, and more is sold. 



10 20 SO 40 S3 60 70 



FIG. 3. Showing Changes in the Supply Curve. 



80 90 



Shillings. 



If the supply curve rise to the upper dotted line the market price will fall to 45*., and 

 900 quarters of wheat will change hands, instead of 800 as iu Fig. 1. 



If the supply curve fall as shown by the lower dotted line the market price will rise to 

 55.s., but only 600 quarters will be sold. 



The whole supply, the price at which all would be sold or none sold, all bought or none 

 bought, may a'l remain unaltered, as well as the demand curve. In practice some 

 or all of these elements would generally vary when the supply curve varies. 



C. If the demand at a price increases at prices near the 

 market price, as shown in the upper dotted line (Fig. 4), prices 

 rise, and more is sold. 



D. If the supply at a price decreases at prices near the 

 market price, as shown in the lower dotted line (Fig. 3), prices 

 rise, and less is sold. 



FJ. If the demand at a price decreases at prices near the 

 market price, as shown in the lower dotted curve (Fig. 4), prices 

 fall, and less is sold. 



F. It is possible that both the demand at a price and supply 

 at a price may increase simultaneously, so that the price shall be 

 unaltered, while more of the commodity is bought and sold, or 

 less of the commodity may change hands with an unaltered price 

 demand and supply decreasing simultaneously. 



