An improvement in a firm's technology that improves productivity results in a(n):

Question

Quizplus · Accepted Answer

An improvement in a firm's technology that improves productivity increases the efficiency of production, leading to an increase in output for the same amount of resources. This leads to the firm's willingness to supply a larger quantity than before at any given price, resulting in a rightward shift of the supply curve. Choice A and D are incorrect because a leftward shift of the supply curve implies a decrease in supply, while a downward movement indicates a decrease in price. Choice B is incorrect because an upward movement along the supply curve indicates an increase in price, which may not be the case here.

An Improvement in a Firm's Technology That Improves Productivity Results