Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and S2 and D2 the new curves. In this market the indicated shift in supply may have been caused by

Question

Quizplus · Accepted Answer

The shift in supply from S1 to S2 indicates an increase in supply, which could be caused by the development of more efficient machinery for producing the commodity. This would allow producers to produce more of the good at the same or lower cost, increasing the supply at any given price level. The other options are less likely to result in an increase in supply.

Refer to the Diagram, in Which S1 and D1 Represent