What is the expected effect of increased productivity on the supply curve?

Multiple choice question for Supply and Demand. Select an option, then review the explanation below.

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Cause the supply to decreaseResult in a growth of supplyCause the supply curve to shift outward, meaning more quantity supplied at every priceResult in a higher price equilibrium but a reduced equilibrium quantityHave no impact on supply

Explanation

An improvement in productivity typically causes the supply curve to shift outward, indicating that producers can supply more goods at each price level. This is because increased productivity lowers production costs, enabling higher output.

Practice related questions from the same subject.

1.What is the typical shape of a demand curve?
2.What term describes a company earning profits beyond its normal profit level?
3.How does an increase in marginal cost affect output, and how does an increase in marginal revenue impact output?
4.Marginal revenue refers to the ________ resulting from producing an additional ________ of output.
5.What are firms generally assumed to do with their costs and profits?

What is the expected effect of increased productivity on the supply curve?

Explanation

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