QO and Q1 and it needs to correct . The price decreases to Pe due to forces pushing down to bring about equilibrium . The new equilibrium is now at E1 and no longer at E . The supply shock has now been rectified (Martin F . J . Prachowny 1985 . Increase in supply E AS Po AS1 E1 Pe AD Surplus Qo Qe Q1 The following graph deals with the decrease in supply . It shows the various effects that this decrease has on price...











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