For example, new competing technology called an eventual fall in demand of video cassettes and an eventual reduction of the supply as a new equilibrium was reached. Now there are only a few VHS players and cassettes remaining on the market, while the amount of TiVo and DVR users has exponentially increased. But this took time as people replaced their systems and converted their libraries from one medium to the new medium. The demand for some goods is more responsive to changes in prices than other goods. For example, food as a whole might seem like a very inelastic good -- people have to eat. But because there are so many substitute goods for a meal, within the category of food price is often very elastic -- consumers will respond to an increase in the price of restaurant meals by cooking at home.

The degree to which the supply curve can respond to changes in demand will vary with the product as well. For example, every great once and awhile there will be an extremely warm winter. Mittens and scarves will pile up in department stores, as producers cannot adjust their supply to a decrease in demand -- they must plan ahead how much winter clothing they will manufacture for the season....

Although they may slash the prices, there is only so 'low they can go' without taking a catastrophic loss, given the cost of the input materials. During a very cold snap, it is difficult to increase inventories of winter clothing by rapidly increasing production and shipping the goods to stores. However, if there is a very hot day an ice cream store can increase their supply to make more money off of the sharp increase in demand, and on a cool, rainy day, the store can simply leave the product in storage until the weather changes. However, if the entire summer is cool, or if people are not buying the product due to the recession and having ice cream at home, eventually the store must slash prices to sell the ice cream before it goes bad, will buy less in the way of inventory, and the supply will decrease (The market system, 2009, part 2)..
Works Cited

Economics basics: supply and demand. (2009). Investopedia.

Retrieved May 20, 2009 http://www.investopedia.com/university/economics/economics3.asp

The market system. (2009). Biz/Ed

Retrieved May 20, 2009

http://www.bized.co.uk/learn/economics/markets/mechanism/interactive/part1.htm