Introduction to Economics 1 Deneme Sınavı Sorusu #756460

I.A decrease in the market price II.A decrease in production costs  III.An increase in the number of firms Which of the above is the factor that can cause the market supply curve to shift to the rightward?


Only I

Only III

I and II

I and III

II and III


Yanıt Açıklaması:

There are basically two factors that can cause the market supply to shift to the rightward: (i) A decrease in production costs shifts the market supply curve rightward. For example, a technological innovation which leads to a rise in labor productivity decreases the unit labor cost and causes the market supply curve to shift to the right. (ii) In the long run, an increase in the number of firms, i.e., new firms entering the industry, shifts the market supply curve rightward. The correct answer is E.

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