![FIGURE 6-2 Equilibrium and Shifts of the Supply Curve](c07_fig02.jpg)
The original equilibrium in the market for cotton is at E1. Bad weather in cotton-growing areas causes a fall in the supply of cotton and shifts the supply curve leftward from S1 to S2. A new equilibrium is established at E2, with a higher equilibrium price, P2, and a lower equilibrium quantity, Q2.