GM+Halts+Volt+Production+to+Realign+Supply+to+Demand+by+Ric

//**REMEMBER: DO NOT SUMMARIZE THE ARTICLE!!!**//

=TITLE OF EXTRACT:= GM Halts Volt Production to Realign Supply to Demand

=SOURCE:= [] Hybrid Cars

=DATE EXTRACT WAS WRITTEN:= March 2, 2012

=DATE CURRENT EVENT WAS WRITTEN:= March 6, 2012

=EXPLANATION OF THE ECONOMIC THEORY RELATED TO THE ARTICLE:= When demand and supply come together, we get the creation of the equilibrium market price and quantity. The equilibrium is self-righting. If a firm tries to raise its price, then there will be **excess supply** at the new price and price will fall back to the equilibrium.

=VOCABULARY TERMS AND DEFINITIONS:=
 * **Demand:** The willingness and ability of a consumer to purchase a quantity of a good or service at a certain price (in a given time period).
 * **Supply:** The willingness and ability of a producer to produce a quantity of a good or service at a certain price (in a given time period).
 * **Law of demand:** As the price of a good falls, the quantity demanded will normally increase. (The demand curve usually slopes downwards, ceteris paribus).
 * **Law of supply:** As the price of a good rises, the quantity supplied will normally rise. (The supply curve usually slopes upwards, ceteris paribus).

=DIAGRAMS:=

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=EVALUATION:= To achieve equilibrium, General Motors will have to shut down some of its assembly plants due to the excess supply it is experiencing. There will have to be temporary "lay-overs." After halting or decreasing the production of their product, can an equilibrium be achieved. A decrease of supply (a shift left) will put the market into its self-righting place. Figure 1 shows the current market of General Motor's Volt, Figure 2 shows the "fix" after the decrease of supplies.