An advance in production technology will

Question

Quizplus · Accepted Answer

An advance in production technology will lower a firm's costs, allowing it to produce more output at each price level. This will cause the supply curve to shift to the right. However, it will not affect the demand curve, which is determined by consumer preferences and other factors unrelated to production costs. As a result, the equilibrium price and quantity will both increase, but the degree of the increase will depend on the specific market conditions.

An Advance in Production Technology Will