If input prices fall, the cost of production will also fall, causing the supply curve to shift to the right.

Name: If input prices fall, the cost of production will also fall, causing the supply curve to shift to the right.
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Question

Quizplus · Accepted Answer

When input prices fall, it reduces the cost of production, making it more profitable for firms to produce and supply more goods. This causes the supply curve to shift to the right, indicating an increase in the quantity supplied at each price level.

If Input Prices Fall, the Cost of Production Will Also