Supply

A change in the good's own price (and nothing else) produces a movement along the existing supply curve. The curve stays put; only the point on it moves.

Extension of supply. When the price rises (P↑), the quantity supplied rises, and the point moves up and to the right along the curve.

Contraction of supply. When the price falls (P↓), the quantity supplied falls, and the point moves down and to the left along the curve.

Note that the directions are the opposite of demand. With demand, extension is caused by a price fall; with supply, extension is caused by a price rise. The naming is consistent only in that "extension" always means a movement that produces a larger quantity and "contraction" always produces a smaller quantity.

Example — A small cement factory sells bagged cement at £4 per bag and produces 800 bags per week. The price rises to £5 per bag and weekly output increases to 1,000 bags. Holding everything else constant, this is an extension of supply: the supply curve has not moved, but the point on it has shifted up and to the right.

Two vocabulary distinctions that examiners specifically test:

• "A change in quantity supplied" = movement along the curve (own-price change).
• "A change in supply" = shift of the entire curve (non-price factor).

These phrases are not interchangeable.