Refer to the table below. If a technological advance lowers production costs such that the quantity supplied increases by 60 units of this product at each price, the new equilibrium price would be:

Question

Refer to the table below.  If a technological advance lowers production costs such that the quantity supplied increases by 60 units of this product at each price, the new equilibrium price would be:

Quizplus · Accepted Answer

At the initial equilibrium, the price is $12 and the quantity supplied is 240 units. If a technological advance lowers production costs, the supply curve will shift to the right by 60 units at every price. This means that at a price of $12, the new quantity supplied will be 300 units. This is the new equilibrium point where the supply curve intersects with the original demand curve. Therefore, the new equilibrium price will still be $12.

Refer to the Table Below