Will speedometer readings be more or less than actual speed when the cars wheels are replaced with smaller ones?

If the outside diameter of the new wheel (tire) is smaller then the tire will have to make more revolutions to equal what the manufacturer calibrated the spedometer to. The result would be your vehicle reading higher than actual speed. The solution it to make sure the vehicle is recalibrated to the new diameter. Sometimes this is as simple as a gear change in the transmission (external)