The incorporation of capital and labor saving technological advance will cause the average cost curve of a firm to:
A)shift to the left.
B)shift upward.
C)shift downward.
D)turn more sharply in the neighborhood of its minimum.
E)none of the above.

Question

Quizplus · Accepted Answer

The incorporation of capital and labor saving technological advance will result in a reduction in average cost because the introduction of technology will increase productivity, use fewer resources, reduce labor costs, and generate savings. This shift will cause the average cost curve of a firm to shift downward. Therefore, option C is the correct answer.

The Incorporation of Capital and Labor Saving Technological Advance Will