The Development of a New Production Technique That Lowers the Cost

question 32

True/False

The development of a new production technique that lowers the cost of producing product X will shift the supply curve of product X to the right.

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Definitions:

Purely Competitive

A market structure characterized by many buyers and sellers, with all firms selling identical products and no single buyer or seller able to influence the market price.

Imperfectly Competitive

Referring to market structures that do not meet the conditions of a perfect competition, often characterized by a small number of sellers, product differentiation, or barriers to entry.

MP

Member of Parliament; an elected official to the national legislative body in many countries.

Haircuts

A reduction applied to the value of assets for purposes of calculating capital requirements, risk, or losses.