Learning Contents:                                                              ·           Difference between  Contraction of Supply and Decrease in Supply. Difference between Contraction of Supply and Decrease in Supply   Basis     of Difference      Contraction of Supply     Decrease in Supply   Meaning When quantity supplied for a commodity falls due to fall in the price, keeping other factors as constant is called contraction of supply. When supply for a commodity decreases due to change in other factors, keeping price as constant is called decrease in supply. Cause Fall in price of the commodity is  the  sole cause for the contraction of supply. Several causes such as: a. Change of firm’s objective from sales maximization to profit maximization. b. When firm is operating on an outdated technology. c. Government imposes more taxes and grants less