📚 Learning Guide
Shifts in Supply Curve
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Which of the following factors would likely cause a rightward shift in the supply curve for smartphones?

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Choose the Best Answer

A

Decrease in production costs due to new technology

B

Increase in consumer demand for smartphones

C

Implementation of higher taxes on smartphone manufacturers

D

Anticipation of future price increases in smartphones

Understanding the Answer

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Answer

A rightward shift of the smartphone supply curve happens when it becomes cheaper or easier to produce more phones at every price. For example, if a new manufacturing technique reduces the cost of the chips used in phones, producers can make more units for the same price. When the cost per phone drops, companies supply more phones at each price level, moving the supply curve to the right. This shift is driven by lower input costs or improved production technology. So, a decrease in the price of a key component, like the smartphone processor, would likely cause that rightward shift.

Detailed Explanation

When new tools make phones cheaper to make, factories can produce more at each price. Other options are incorrect because More buyers want phones, but that changes the demand curve, not supply; Higher taxes add cost to making phones, so factories produce less.

Key Concepts

Supply Curve Shift
Production Costs
Consumer Demand
Topic

Shifts in Supply Curve

Difficulty

medium level question

Cognitive Level

understand

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