Question 44

The supply curve shifts to the right.

The development of new technology that allows a candy company to produce chocolate bars faster results in an increase in supply, which is represented by a rightward shift of the supply curve.

A) The supply curve shifts to the left

This option is incorrect because a leftward shift in the supply curve represents a decrease in supply, which would occur if production costs increased or if there were fewer producers in the market. The introduction of more efficient technology does not decrease supply; rather, it enhances production capabilities.

B) The supply curve does not change, but there is movement down the curve to a new point

This option is incorrect as it implies a decrease in price leading to a higher quantity supplied without a change in the supply curve itself. However, the introduction of new technology increases the overall supply, which shifts the curve to the right rather than causing a movement along the existing curve.

C) The supply curve does not change but there is movement up the curve to a new point

This option is also incorrect because movement up the supply curve would indicate a decrease in supply or an increase in price, leading to a lower quantity supplied. The new production technology increases supply, which shifts the entire curve to the right instead.

D) The supply curve shifts to the right

This option is correct as it reflects the increase in supply due to the new technology that allows for faster production of chocolate bars. A rightward shift in the supply curve indicates that at every price level, a greater quantity of chocolate bars will be available in the market.

Conclusion

The correct answer is that the supply curve shifts to the right, reflecting an increase in supply due to advancements in production technology. All other options incorrectly suggest either a decrease in supply or movement along the curve without a change in overall supply, which does not align with the effects of improved production efficiency.