Final answer:
When the price of an item like FSU jerseys declines, the quantity supplied typically decreases, as shown by a leftward shift in the supply curve. This reduction in quantity supplied aligns with the law of supply and occurs because suppliers are less inclined to sell at lower prices.
Step-by-step explanation:
When the price of an item such as FSU jerseys falls, the quantity supplied typically also decreases. This happens because suppliers are less willing to provide goods at a lower price, as it may not cover their costs and profit margins. This concept is based on the law of supply in economics.
Considering Graph 2, which indicates a decrease in supply and a shift in the supply curve to the left, such as from So to S1 in FIGURE 3.10 Shifts in Supply: A Car Example, we understand that the result of a decreased supply is that at every given price, the quantity supplied is lower. For instance, when the price of steel increases, making car production more expensive, the supply curve reflecting car manufacturers' willingness to supply at various prices will shift to the left from So to S1, indicating a reduced quantity supplied at any given price.