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Question & Answer
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The supply curve shifts left, leading to higher consumer prices
The supply curve shifts right, leading to lower consumer prices
The supply curve remains unchanged, and consumer prices stay the same
The supply curve shifts right, leading to higher consumer prices
Understanding the Answer
Let's break down why this is correct
When technology improves, producers can make more goods for less money. Other options are incorrect because Some think lower cost means fewer goods because producers save money; The idea that supply stays the same ignores that cost changes affect how much is made.
Key Concepts
Shifts in Supply Curve
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Deep Dive: Shifts in Supply Curve
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Definition
Shifts in the supply curve occur when factors other than price influence the quantity of a product supplied at each price level. Changes in production costs, technology, government policies, and expectations can shift the supply curve either outward (increase in supply) or inward (decrease in supply).
Topic Definition
Shifts in the supply curve occur when factors other than price influence the quantity of a product supplied at each price level. Changes in production costs, technology, government policies, and expectations can shift the supply curve either outward (increase in supply) or inward (decrease in supply).
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