Suppose there is an improvement in the technology of producing TVs and the production of TVs becomes an increasingly competitive industry. Assuming that the TV industry is initially in equilibrium, the long-run effect of this improvement is:
A) higher TV prices and greater TV production.
B) lower TV prices and greater TV production.
C) higher TV prices and lower TV production.
D) lower TV prices and lower TV production.

Question

Quizplus · Accepted Answer

Improved technology reduces production costs, leading to increased supply. In a competitive market, this results in lower prices and higher production in the long run.

Suppose There Is an Improvement in the Technology of Producing