48. A candy company develops a new technology for producing chocolate bars faster. How does this affect the supply curve for chocolate bars?
Answer: D
The supply curve shifts to the right
The development of a new technology that allows a candy company to produce chocolate bars faster results in an increase in supply. This innovation enables the company to produce more products at the same cost, thus shifting the supply curve to the right.
A) The supply curve does not change, but there is movement up the curve to a new point
This option suggests that the supply curve remains unchanged, which is incorrect. While movement along the curve indicates a change in quantity supplied due to price changes, the introduction of new technology fundamentally alters production capacity, leading to an outward shift of the entire supply curve.
B) The supply curve does not change, but there is movement down the curve to a new point
Similar to option A, this option implies that the supply curve remains static, which is inaccurate. Movement down the curve indicates a decrease in quantity supplied, typically due to a price drop, but with the new technology improving production efficiency, the overall supply increases, necessitating a shift in the curve itself.
C) The supply curve shifts to the left
A leftward shift in the supply curve indicates a decrease in supply, which contradicts the scenario described. The implementation of faster production technology enhances the company’s ability to supply more chocolate bars, thereby shifting the supply curve to the right, not to the left.
D) The supply curve shifts to the right
This option correctly reflects the effect of the new technology. By enabling faster production, the company can supply a greater quantity of chocolate bars at every price level, resulting in a rightward shift of the supply curve, which represents an increase in supply.
Conclusion
The correct answer, D, illustrates the principle that advancements in production technology lead to an increased ability to supply goods, thereby shifting the supply curve to the right. All other options fail to recognize this fundamental economic concept, either suggesting no change or a decrease in supply, which does not align with the effects of technological improvements in production.