In recent years, technological improvements have greatly reduced the costs of producing smartphones, and a number of new firms have entered the smartphone industry. At the same time, prices of substitutes for smartphones, such as various tablet devices, have declined considerably.

Construct a supply and demand diagram of the market for smartphones. Illustrate the impacts of these developments, and evaluate the effects on the market price and equilibrium quantity.

Illustrate the impacts of these developments, and evaluate the effects on the market price and the equilibrium quantity.