Question

If a technological advance makes it easier to produce some product, we should expect to see......

If a technological advance makes it easier to produce some product, we should expect to see...

Supply to Increase, causing the price to fall and the equilibrium quantity to rise

Supply to Decrease, causing the price to rise and the equilibrium quantity to fall

Demand to Increase, causing the price to rise and the equilibrium quantity to rise

Demand to Decrease, causing the price to fall and the equilibrium quantity to fall
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Answer #1

Option A.

  • If a technological advancement makes it easier to produce some product, we should expect to see supply to increase, causing the price to fall and the equilibrium quantity to rise.
  • When the technology improves, it becomes easier for the producers to produce more of a good to earn more profit.
  • With increased production, the equilibrium quantity rises.
  • As the equilibrium quantity rises the suppliers of those goods will naturally decrease their price Inorder to earn more profits.
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