ECONOMICS
SUPPLY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Shift the supply outwards
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Shift the supply inwards
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A movement along the supply curve with an extension in quantity supplied
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None of the above
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Detailed explanation-1: -Any improvement in technology will shift the supply curve right side. The reason behind it is that any technological improvement will decrease the production cost that leads to increased production and also at a lower price. Therefore the supply of that particular product will increase causing the curve to shift right.
Detailed explanation-2: -A technological improvement that reduces costs of production will shift supply to the right, causing a greater quantity to be produced at any given price.
Detailed explanation-3: -Technology leads to an increase in the efficiency of the production process which results in the shifting of the supply curve to the right. With decreasing cost of production more and more customers will be demanding the product. Also read: Price Elasticity of Supply.
Detailed explanation-4: -An outward shift in the supply curve represents an increase in supply. This can be due to an improvement in the technology which makes the production process more efficient and cheaper hence increasing the supply.
Detailed explanation-5: -A variable that can change the quantity of a good or service supplied at each price is called a supply shifter. Supply shifters include (1) prices of factors of production, (2) returns from alternative activities, (3) technology, (4) seller expectations, (5) natural events, and (6) the number of sellers.