If the cost of computer chips, a key component in making personal computers, declines, what will be the effect on the market for personal computers?

Show Answers

a reduction in the quantity of personal computers supplieda decline in the overall supply of personal computersa rise in the quantity of personal computers suppliedan expansion in the supply of personal computersno change in supply or quantity supplied of personal computers

Explanation

When the price of an input like computer chips decreases, it lowers production costs, enabling manufacturers to produce more at each price level. This causes the supply curve to shift rightward, resulting in an increase in the supply of personal computers rather than just a change in quantity supplied.