The Discovery and Dissemination of a New Cost-Saving Technology

question 123

Multiple Choice

The discovery and dissemination of a new cost-saving technology

• A) is an example of a positive demand shock
• B) would cause the long-run AS curve to shift leftward,thereby increasing both output and the price level
• C) would increase firms' unit costs
• D) would lead to an increase in output and a decrease in the price level
• E) is an example of a negative supply shock

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Definitions:

Diffusion

The process by which an innovation or idea spreads within a society or from one society to another over time.

Technological Advance

The process of developing new and better ways of doing things, particularly in areas like science, engineering, and manufacturing.

Invention

An invention is a unique or novel device, method, composition, or process that extends the boundaries of human knowledge or capability.

Innovation

Converting a thought or discovery into a valuable offering or solution that attracts customer investment.