If a sudden technological advancement in production allows firms to reduce costs significantly, what is the most likely immediate effect on market prices and quantity supplied in a competitive market?

When a sudden technological advancement helps firms reduce their production costs, it usually leads to a decrease in the prices of their products. This happens because firms can produce more goods at a lower cost, so they are willing to sell these goods for less money. As prices drop, consumers are likely to buy more, increasing the overall quantity demanded in the market. For example, if a company that makes smartphones finds a way to produce them cheaper, they might lower the price, leading to more people wanting to buy new phones. In a competitive market, this increase in supply and decrease in price can create a balance where more products are available for consumers at lower prices.